'Good Work' - The Taylor Review

In October 2016, the Prime Minister commissioned Matthew Taylor, a former policy chief to Tony Blair, to look at how employment practices need to change in order to keep pace with modern business needs.

The Review, entitled 'Good Work', has now been published and makes many recommendations. These focus broadly on three challenges:

  • Tackling exploitation and the potential for exploitation at work;
  • Increasing clarity in the law and helping people know and exercise their rights; and
  • Over the longer term, aligning the incentives driving the nature of our labour market with our modern industrial strategy and broader national objectives.

The Review supports maintaining the flexible and adaptable approach to labour market regulation that has benefited the UK so far, while focusing more closely on the quality of work as well as the number of people employed.

Whilst some of the recommendations are very specific and could easily be implemented, others are broader, although based on clear principles, and will require further consultation and consideration before implementation. Some are long term and strategic, indicating policy aims but not prescribing in detail how to achieve them.

These are just some of the recommendations contained in the report:

  • The National Living Wage, whilst a powerful tool to raise the financial base line of low-paid workers, should be accompanied by strategies to ensure that people are not stuck at that level of pay but can progress in their current and future work;
  • The status of 'worker' should be retained but renamed 'dependent contractor', with a clearer distinction drawn between the rights of employees, dependent contractors and those who are legitimately self-employed. In redefining 'dependent contractor status', the Government should adapt the piece rates legislation to ensure those working in the gig economy are still able to enjoy maximum flexibility whilst also being able to earn the National Minimum Wage;
  • Individuals should be able to obtain an authoritative determination of their employment status at an expedited preliminary Employment Tribunal (ET) hearing without having to pay a fee. The burden of proof in ET hearings should be reversed so that the employer has to demonstrate that the individual is not entitled to the relevant employment rights;
  • In developing the 'dependent contractor test', an attempt should be made to align the employment status framework with the tax status framework to ensure that differences between the two systems are reduced to an absolute minimum;
  • Those on zero-hours contracts should be given the right to request guaranteed hours after one year;
  • The Government should consider whether temporary changes to employment contracts might be allowed in order to accommodate flexibility needed for a particular caring requirement; and
  • Employers should be required to issue a written statement of employment particulars to all workers, not just employees, on day one of their employment so that they are better informed about their rights and obligations.

There are further recommendations, including on the rights of agency workers, holiday pay, the rights of workers on long-term sickness absence, ET powers to impose penalties, Information and Consultation arrangements and the enforcement powers of HM Revenue and Customs and the Department for Business, Energy and Industrial Strategy.