Sick pay and holidays for self-employed after criticism of the ‘gig economy’
Report recommends new category of ‘dependent workers’ at firms such as Uber and Deliveroo
SICK leave and paid holidays will be extended to temporary workers in the “gig economy” under plans announced tomorrow in a review commissioned by Theresa May.
Matthew Taylor, Tony Blair’s former head of policy, will release his report which will address concerns that millions of people do not enjoy standard workplace rights.
It aims to help more than one million people who are working in the “gig economy” for companies such as Uber and Deliveroo, which treat workers as contractors rather than employees.
Critics say that the gig economy exploits workers – who are paid for tasks completed rather than time worked – by treating them as if they were full-time employees without extending them the same rights.
Mrs May, who launched the review last year, will say tomorrow: “A year ago, I stood outside Downing Street for the first time as Prime Minister, and I set out the defining characteristics of the Government I was determined to lead, a belief that at the heart of that change must lie a commitment to greater fairness in our country as we tackle the injustice and vested interests that threaten to hold us back, and make Britain a country that works for everyone, not just a privileged few.
“I am convinced that the path that I set out in that first speech outside No10 and upon which we have set ourselves as a Government remains the right one.
“It will lead to the stronger, fairer Britain that we need. It will deliver the change people want. It will ensure we make the most of this opportunity to ask ourselves what kind of country we want to be and to answer that question with confidence, optimism and hope. That is why I am so grateful to Matthew for the report he is publishing, because the issues it confronts go right to the heart of this Government’s agenda and right to the heart of our values as a people.”
The report is expected to recommend that the Government should introduce a new category of “dependent contractors” who are not employees but eligible for workers’ rights.
It will make clear that they are entitled to sick and holiday pay, but leave the issue of who qualifies as a “dependent contractor” to the tribunals and courts. The review will also suggest that self-employed workers could benefit from maternity and paternity leave if they pay more in national insurance contributions.
The Government has ruled out trying to raise Class 4 national insurance contributions on the self-employed after a furious backlash.
Mr Taylor, chairman of the Royal Society of Arts, will also suggest that employers should be encouraged to recognise the “life-skills” of workers in law paid jobs. He is expected to recommend that ministers should encourage employers to formally recognise values such as teamwork, communication and experience.
Mr Taylor wants to ensure that fewer people are stuck in “dead end jobs” as part of a “crusade for good work”. The report will suggest that while there has been a significant increase in the number of jobs under the Conservatives, there has been a reduction in the quality of those jobs.
It will stop short, however, of recommending that all workers in the gig economy should be entitled to the minimum wage.
Mr Taylor will instead call for a system that offers the right to earn at least the hourly minimum wage if they are prepared to work at times of high demand and at an average pace.
The system, defined as “piece work” in current legislation, ensures that these workers are paid either the national minimum wage or a so-called “fair rate” per job.
This is currently equivalent to 20 per cent above the hourly minimum wage rate of £7.50 for the over-25s. Mr Taylor will also recommend that employers operating via digital platforms use their technology to estimate in “real time” how much they will earn before they start a shift.
People on zero-hours contracts, who are not guaranteed paid hours contracts, will be given the right to request fixed hours instead. The move stops short of calls by Jeremy Corbyn, the Labour leader, for an outright ban on zero-hours contracts.
The review stands in contrast to a similar exercise by Adrian Beecroft, the venture capitalist, ordered by David Cameron’s Downing Street aides. The Beecroft review recommended scrapping swathes of employment legislation, but was blocked by the Liberal Democrats.
The review will address concerns that “rapidly changing business models and working practices continually stretch the limits of our employment rules”. A total of 4.8million people are self-employed, 900,00 on zero hours contracts and 1.7million in temporary work.