UK Proposes New Protections for Gig Economy Workers

UK Proposes New Protections for Gig Economy Workers

The UK government on Wednesday announced a series of planned labor market reforms to improve the working conditions and protect the rights of the millions of Britons employed in the gig economy and other flexible or contingent models of work, based on the findings of the Independent Review of Employment Practices in the Modern Economy, led by Matthew Taylor, which were published last July. The government says is intends to adopt almost all of the Taylor Review’s recommendations, the BBC reports:

The changes include stricter enforcement of holiday and sick pay rights, and higher fines for firms that breach contracts or mistreat staff. … The government says it is going further than the Review’s recommendations by:

  • Enforcing holiday and sick pay entitlements
  • Giving all workers the right to demand a payslip
  • Allowing flexible workers to demand more stable contracts

The quantity and quality of jobs in the gig economy will be monitored and steps will be taken to make sure flexible workers are aware of their rights. The government is also asking the Low Pay Commission to consider a higher minimum wage for workers on zero-hour contracts, and says it may also repeal laws that allow agencies to employ workers on cheaper rates.

The reforms have not yet been fleshed out in much detail, while some of the plans announced on Wednesday involve not changing laws or regulations, but rather more strictly enforcing those already on the books. “The government’s plan will make sure that everyone knows what they’re entitled to when they start working for a company and the rules will now be enforced by HMRC, so people actually get what they’re owed,” BBC Business Correspondent Theo Leggett explains.

British trade unions are not impressed with the plans, however, which they consider insufficiently substantial. Sky News sums up their reaction:

The GMB union said the Government’s plans were akin to “trying to put out a forest fire with a water pistol” and the TUC said the Government had taken a “baby step, when it needed to take a giant leap”. Jason Moyer-Lee, general secretary of the Independent Workers Union of Great Britain, told Sky News the Government needs to be as tough on abuse in the gig economy as it is on crime:

“These companies know they are unlawfully depriving workers of rights they’re entitled to and the reason they get away with it is because there’s no government enforcement. But for government enforcement to be effective they need to put in the resources to properly enforce the law and create a deterrent effect so these companies have an incentive to obey the law.”

Indeed, some lawmakers have pushed for stronger government action to rein in employment practices seen as abusive: In December, for example, one MP introduced a bill that would ban zero-hours contracts entirely rather than granting these workers a higher minimum wage. TechCrunch’s Natasha Lomas hears from a UK employment lawyer who suspects the government isn’t punting on the issue, but rather putting down a marker of its commitment to tackling these problems over the course of the coming year:

Discussing the overall reform plan, Sean Nesbitt, a litigator on employment issues at law firm Taylor Wessing, told us: “The government is looking to make a big statement about their commitment to reforming and making fit for purpose modern work for the 21st century but, although there’s a broad commitment and a big statement, there’s not too much detail as to what they’re proposing.” …

In terms of specifics, Nesbitt says the current classification framework of employee, worker and dependent contractor is unlikely to change, but the government intends to provide more clarity as to how to differentiate among them. A particularly important issue that the law could help clear up is what counts as “working time” for people working on platforms like Uber:

Nesbitt points out that many platforms don’t accept the view that a worker being logged onto their app and waiting time constitutes ‘working’. So if the government were to legislate on that it could help inject a little more certainty into the gig economy — for players on both sides.

“The government could find a way forward and say well it isn’t necessarily being logged on that’s the determining feature — you have to be actively working or at least committed to the exclusion of other opportunities,” Nesbitt suggested. “So they could find a way to do it — but it’s not clear when and how they’re going to do it.”

Gig economy firms have received mixed opinions from UK courts on whether those who use their platforms for work are entitled to rights as employees. In November, Uber lost an appeal of a labor tribunal ruling that its drivers are employees and thus entitled to minimum wage, overtime/holiday pay, and other protected benefits. The same week, however, the Central Arbitration Committee found that Deliveroo, an Uber-like platform for restaurant takeout deliveries, was in the right to treat its delivery workers as self-employed.