The Taylor Report – points of interest…

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The Taylor Review – now renamed the ‘Good Work’ report, has recently been published. There are a number of points of interest but here are our top ten:-

Establishing employment status – the future of the worker – There is confusion in the current three tier system and the two categories of people that are eligible for ‘worker’ rights should be easier to distinguish from one another. The report states that the government should introduce a new name for people who are eligible for ‘worker’ rights but are not employees. The recommendation is for this group to be termed ‘dependent contractors’.

Flexibility – The government must take steps to ensure that job flexibility does not benefit the employer, at the unreasonable expense of the worker. Flexibility should be a mutually beneficial arrangement. The suggestion, therefore, is to consider the impact of increasing the National Minimum Wage for hours that are not guaranteed as part of a contract.

Managing gaps in service – Current worker rights take effect on day 1 of employment but there are many rights that require a period of continuous service before the individual becomes eligible, such as applying for flexible working or claiming unfair dismissal. Most employees would have little problem showing their continuous employment but for those that work casually or intermittently it can be more difficult. Therefore, the recommendation is that the government should extend the consideration for the relevant break in service, from one week to one month, for the calculation qualifying period for continuous service.

Calculation of holiday pay – Currently, the holiday entitlement of a worker that works abnormal working hours is based on the hours worked over a pay reference period of 12 weeks. This does not work for everyone, especially with reference to seasonal work and where there are peaks and troughs in work. Also it is often the case that agency workers and those on zero hours contracts are unaware that they are entitled to holiday pay or are too afraid to take it. The government should make increased efforts to communicate who is entitled to holiday pay. They should also consider extending the pay reference period to 52 weeks.

The receipt of paid annual leave – Individuals should have greater choice in the way in which they receive paid annual leave. ‘Dependent contractors’, those eligible for worker rights but are not employees, should be given the opportunity to receive ‘rolled-up’ holiday pay. This would mean they would receive a 12.07% premium on their pay.

Zero hours contracts – Banning zero hours contracts in their totality would neither be helpful nor practical, in fact it would negatively effect more people than it would help. It is suggested, however, that those on zero hours contracts should have the opportunity, after a fixed period of time, to request a fixed hours contract. The average weekly hours worked over the past 12 months would be the starting point for the new contract.

Temporary flexible working – Flexible working is shown to have great benefits to both employers and workers. The government should now consider how further to promote genuine flexibility in the workplace. One consideration would be whether temporary changes to contracts could be allowed. These would help workers in times when flexibility is needed for a particular caring requirement.

Statutory Sick Pay – The current policy for SSP is inflexible, it does not allow easily for a phased return to work and currently excludes those that fall below the NI income threshold. It is suggested that SSP should be reformed so that it is available to all workers as a basic employment right, similar to the National Minimum Wage. It should be payable to the employer and accrued on length of service similar to holiday pay.

Employment Tribunal Fees – Employment tribunal fees are seen as a significant barrier for some in bringing a case against their employer. In order to assist individuals to at least ensure that their claim is valid the suggestion is that government should ensure that individuals are able to get an authoritative determination of their employment status without paying any fee and at an expedited preliminary hearing.

Employers that believe they can ignore the law – Government should create an obligation on employment tribunals to impose aggravated penalties and costs orders on an employer who has previously lost an employment status case on similar terms.

There is clearly some work to do on these points but the report clearly reflects the changing nature of the current UK labour market.

Written by

Edward Aston
11th July 2017