Taylor proposals ‘will not be silver bullet’ for gig economy

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Jul 11, 2017
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Matthew Taylor's report on the so-called gig economy is to be released today

Amritpal Virdi for The Times

Recommendations to adapt employment legislation to the growing “gig economy” fail to sufficiently clarify the law for workers and employers, lawyers have argued.

They were responding to leaks in advance of today’s release of the government-commissioned Taylor report into employment practices in the modern economy. Matthew Taylor – the former head of the No 10 policy unit under Tony Blair – is set to unveil his eagerly awaited recommendations today. But lawyers who had seen leaked versions were slightly disappointed.

“The report is certainly a step in the right direction,” said Nick Elwell-Sutton, a partner at City of London law firm Clyde & Co, but added that it “fails to provide a much needed silver bullet to overcome the issues at hand”. According to Elwell-Sutton, the report “rightly acknowledges” the need for a simple and clear test to define workers’ status, but he pointed out that “it is up to the government to decide what that test is”.

He said: “Companies, individuals, lawyers and the judiciary have grappled with this for years and despite best efforts there is an abundance of often contradictory case law and a current situation where each case rests on its own unique facts.  Were there to be a simple solution then it would be surprising the courts have not yet found it.”

Lawyers also claimed that the report will not suggest a ban on zero hours contracts. “It explicitly acknowledges that such a ban would negatively impact more people that it helped,” said Elwell-Sutton. He claimed that Taylor will instead propose that those who have worked for 12 months and have established a degree of permanence can request a guaranteed hours contract based on the average weekly hours worked over the prior year.

Lawyers were also sceptical of Taylor’s proposed creation of a new employment status of a “dependent contractor”. Ranjit Dhindsa, a partner at the London firm Fieldfisher, said: “Creating another status only makes the law more complicated, and it will still be left to Employment Tribunals to determine who has this status, so it will not remove any of the uncertainty for employers.”

Regardless of the review, lawyers predicted that legal action around the gig economy would continue. “Inevitably, there will be further litigation by those seeking to enforce their existing and new rights until changes are made,” said Suzanne Horne, a partner at the City office of the US law firm Paul Hastings. She pointed out that prospective litigants will be “encouraged” by successful actions against at least half a dozen businesses over the last year.

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