The Good Work Plan – significant changes ahead for employers

Following the Taylor report on UK working practices last year. The government has now published its response, which it calls ‘The Good Work Plan’. There are potentially significant changes afoot for employers large and small. Over the coming weeks, we are reviewing the detail of the employment status consultation and will be providing further thoughts as to how this may impact employers.

In the meantime, I provide an overview of some of the key elements of the Good Work Plan:

New rights for employees

Under this plan the government have announced that:

• workers are to get new day-one rights with sick and holiday pay to be enforced for vulnerable workers for the first time
• a new right to a payslip for all workers, including casual and zero-hour workers
• a right for all workers, not just zero-hour and agency, to request a more stable contract, providing more financial security for those on flexible contracts
• reforms will be introduced to ensure employment law and practices keep pace with modern ways of working created by rapid technological change
• the government will be accountable for good quality work as well as quantity of jobs - a key ambition of the UK’s Industrial Strategy

Protection of existing rights

The government intends to further protect worker’s rights by:

• taking further action to ensure unpaid interns are not doing the job of a worker;
• introducing a new naming scheme for employers who fail to pay employment tribunal awards
• quadrupling employment tribunal fines for employers showing malice, spite or gross oversight to ￡20,000 and considering increasing penalties for employers who have previously lost similar cases

Fair pay

In addition the government intend to ensure workers are being paid fairly by:

• providing agency workers with a clear breakdown of who pays them and any costs or charges deducted from their wages
• asking the Low Pay Commission to consider the impact of higher minimum wage rates for workers on zero-hour contracts
• considering repealing laws allowing agencies to employ workers on cheaper rates
• defining ‘working time’ for flexible workers who find jobs through apps or online so they know when they should be being paid

Transparency

The government are also looking to increase transparency in the working environment by:

• launching a task force with business to promote awareness and take-up of the right to request flexible working introduced in 2014
• making sure new and expectant mothers know their workplace rights and raise awareness amongst employers of their obligations
• launching a new campaign to encourage more working parents to share childcare through Shared Parental Leave – a right introduced in 2015

Government consultations

In order to implement the above changes the government are to launch the following consultations:

• Consultation on enforcement of employment rights recommendations
• Consultation on agency workers recommendations
• Consultation on measures to increase transparency in the UK labour market
• Consultation on employment status

Whilst the government have acted on almost all of the recommendations made by the Taylor report, they have however rejected the proposal to reduce the difference between the National Insurance contributions of employees and the self-employed following Budget 2016 and subsequently do not intend to revisit the issue.

Blick Rothenberg’s tax dispute specialists and employment taxes team have significant experience and expertise in this field, with a number of recent notable successes in favourably resolving employment status disputes on behalf of clients.

We are well placed to help businesses ‘test’ their existing employment engagement arrangements, and where appropriate, recommend remedial action.