In response to Labour’s promise to extend workers’ rights, the government announced that it hopes to move ahead with plans to boost the rights of workers in the gig economy. Theresa May plans to end the legal loophole known as the Swedish Derogation model that allows companies to pay their full-time staff less for doing the same job.
While this may upset businesses, it will move rights of gig workers forward greatly, helping to bring around equal pay for freelance workers. Business secretary Greg Clark told the cabinet that he hopes to apply several of the recommendations from The Taylor Review, such as new legislation to give workers the right to request contracts after 12 months, naming and shaming employers who fail to pay out after employment tribunals, and clarifying the criteria that decides whether people are workers or are self-employed.
This is part of the discussion around the “one-sided” flexibility that the government has continued to criticise. It is because of a lack of detailed government legislation that freelance workers find it so difficult to get a mortgage for their homes. With 54% of rejected mortgage claims coming from the self-employed, it is clear that something needs to change for freelancers to have more access to the necessary help with purchasing a home. After The Pensions Regulator showed that more than 9 million workers were not enrolled in a workplace pension scheme, it is clear that a form of auto-enrolment needs to be put in place for freelancers and the self-employed in order to assist them in saving for retirement.
If these problems are not fixed, we can expect the downturn in people willing to take the leap to freelance to continue. IPSE point to this coming from the government and choices to move forward with policies like IR35 and Universal Credit.
An unnamed fast-food company and Addison Lee lost their respective cases against Revenue and The Employment Appeal Tribunal. Revenue demanded £215,000 in taxes after ruling that the fast-food company’s drivers are effectively employees and should be taxed as such, while The Tribunal held its belief that drivers for Addison Lee are entitled to minimum wage and holiday pay. However, Deliveroo riders failed in their attempt to overturn a ruling that they were self-employed. The riders, represented by The Independent Workers Union of Great Britain, will go to High Court to argue that Deliveroo has breached basic human rights.
Keep your eye on UnderPinned, as we will soon be releasing an up to date briefing of your rights as a freelance worker in the UK.