POSTED: July 11 2017
The Gig economy; report calls for much needed reform

The Gig economy; report calls for much needed reform

The Taylor Report calls for greater employee rights for gig economy workers to receive statutory sick pay, holiday pay and other benefits.  

The landmark report published today also made recommendations around portable benefits portals and for return to work strategies for gig economy workers.

The report urged the government to introduce a new category of “dependent contractors”.

These individuals, who work for organisations such as Deliveroo or Uber, are not to be classed as employees but ought to be eligible for workers rights.

The report said: For [some workers] self-employment is not a choice but a necessity when other forms of work are not available.

“While many self-employed people would not expect sick pay, paid annual leave or automatic enrolment to a pension, for others, the availability of this safety net is essential to make sure they can pay their rent, put food on the table or plan for the future.

“This can lead to the same levels of anxiety and illness that are experienced by those employed on casual contracts. The Review believes the Government should treat self-employed people like any other section of the labour market, acknowledging that they require a spectrum of intervention, focused at protecting the most vulnerable. ”

The TUC estimates that nearly 500,000 workers on zero hours contracts (ZHC) or in insecure temporary work miss out on the right to statutory sick pay (SSP) because their pay is too low.

The report authors said: “We don’t think it is right that you can be considered too low paid to fall ill.”

It urged HMRC should take responsibility for enforcing the basic set of core pay rights that apply to all workers – NMW, sick pay and holiday pay for the lowest paid workers.

Discussing the recommendations made in the Government’s Green Paper Improving Lives the report also highlighted “low awareness” of initiatives such as Access to Work and the Fit For Work Service.

In terms of sick pay reform the report said: “Press coverage of the issues faced by people working in the gig economy has highlighted sickness protection as one of the key issues.

“However, it also seems perverse to us that an employer should be liable for up to 6 months of Sick Pay for an individual who has only worked for them for a very short period of time.

“There is a danger that this acts as a disincentive to taking on those with long-term health conditions. Government should reform Statutory Sick Pay so that it is explicitly a basic employment right, comparable to the National Minimum Wage, for which all workers are eligible regardless of income from day 1.

“It should be payable by the employer and should be accrued on length of service, in a similar way to paid holiday currently. Government should ensure that there is good awareness of the right amongst workers and businesses.

“In this way, employers will no longer face the liability for long periods of paid sick absence for those who have only worked for them for a short period of time.

“In conjunction with the reforms set out in Chapter 5, the individual will have much greater clarity about their entitlement to basic employment protections. HMRC currently adjudicate on eligibility for Statutory Sick Pay and, for those on the National Minimum Wage, HMRC should continue to enforce the payment of the reformed entitlement.”

The report also recommended improvements way in which return to work is managed.

The report said: “Employers should do more to support those able to return to work to do so, above and beyond any legal requirements to make reasonable adjustments. What is more, those who are sick should not see their job lost or long-term career damaged.

“Those individuals with the relevant qualifying period are already entitled to have their job protected for a period of time when they are away from work for perfectly reasonable reasons, for instance, having a child. A similar approach should be adopted for sick leave with individuals having the right to return to the same or a similar job after a period of prolonged ill health. This right to return should be conditional on engagement with the Fit for Work Service when an assessment has been recommended.”

In addition, the report discussed portable benefits platforms providing access to a range of non-statutory benefits and protections, and how access to these could be improved.

The report said: “They present an opportunity to ‘nudge’ people who are self-employed to set aside money for the long term, e.g. for retirement, in case of injury, or to pursue personal development and training opportunities to further their career.

“Unlike the statutory employment protections enjoyed by workers and employees, portable benefits reflect the more dynamic working arrangements of many self-employed people and so are tied to the individual, rather than to a specific company.

“In the sharing/gig economy, this means that individuals could effectively move freely between platforms because benefits accrued while working on one platform could be retained and topped up if the individual started working on another platform instead or even simultaneously.”


This article was first published in Cover Magazine. You can view the original article here.