This week, the UK Government has set out one of the most extensive set of reforms designed to protect workers’ rights, improve the clarity of the employment status tests and to address issues relating to the rapidly expanding gig economy.
The reforms will implement the majority of propositions as plans set out in the ‘Good Work Plan’, which is the government’s response to Matthew Taylor’s review of modern working practices that was published in July 2017.
However, despite the recommendations, nothing has been changed yet and along with this, they are looking to bring forward proposals in early 2019 for single labour market enforcement body to further ensure workers’ rights are properly enforced.
NumberMill specialises in Recruitment and Outsourcing Sector as well as IR35 & Compliance, engaging contractors transparently and in line with Matthew Taylor’s recommendations. We also hold full FCSA accreditation (regulation favoured by HMRC) and were independently audited by EY in October 2018, with files being passed to HMRC.
Below are a summary and main points of their objectives from their 68-page document;
- To continue monitoring and to expand the remit of Employment Agency Standards Inspectorate to cover Umbrella Companies – allowing them to take enforcement action where required when investigating complaints involving an umbrella company.
- Extending the right to a ‘day one written statement of rights’ to workers – going further to include details such as eligibility for sick leave and pay and details of other types of paid leave.
- To ensure workers are being paid fairly by providing every agency worker with a ‘Key Facts Page’ that includes a clear breakdown of; who will be paying them, umbrella company margin, rate of pay etc.
- Swedish Derogation to be scrapped – a legal loophole which enabled agency workers to be paid less than the permanent counterparts beyond 12 weeks.
- To implement a single labour market enforcement body to ensure vulnerable workers are better protected.
- Employment Tribunal Fines for employers who ‘are demonstrated to have shown malice, spite or gross oversight’ quadrupling from £5,000 to £20,000 maximum.
- Plans to make improvements of the Employment Status tests to show more clarity and reflect the reality of the modern working relationships by “aligning the employment status frameworks for the purposes of employment and tax to ensure the differences between the two systems are reduced to an absolute minimum”.
- Holiday pay reference period to increase from 12 to 52 weeks, a good example of how this would operate can be seen here.
Labour Market Reform
New legislation to upgrade workers’ rights introduced today – including a day one statement of rights for all workers setting out leave entitlements and pay…
Published: 21st December 2018