04 October 2017

Comments for Charities on the Taylor Report


Hugh More
Special Counsel | UK

'Good work: the Taylor Review of modern working practices' was published in July. It contains an overview of the modern UK workplace, with seven core recommendations towards an overall aim of ensuring that all work in the UK's economy is 'fair and decent, …with realistic scope for development and fulfilment'.

A major aspect of the Review was its proposal to clarify employment status and flexible employment.

Taylor recommends that people working on zero-hours contracts or for platform-based companies (such as the much-publicised Uber & Deliveroo) should be classed as 'dependent contractors'. That new terminology would replace the current concept of a 'worker' and would be accompanied by a clear new test for employment status – although Mr Taylor stops short of defining exactly what that test should be. Instead, he recommends that a new test for employment status be codified in primary legislation, focusing particularly on whether an individual is subject to 'control'. This represents a shift away from the current set of case law principles (which Taylor acknowledges demand 'encyclopaedic knowledge' in order to determine employment status).

In our view, clarity in this area would indeed be welcome, both for individuals and for employers.

Taylor also recommends giving those on zero-hours contracts, after 12 months, the right to request a contract for the fixed hours they have been working. CIPD research suggests that voluntary sector employers are most likely to use zero-hours contracts (34% in 2013), followed by the public sector (24%) and the private sector (17%), so changes in this area are worth looking out for. He proposes refining the test for 'self-employment' and harmonising tax and National Insurance regimes (to ensure a consistency of approach between the employment and tax tribunals, and to remove any tax disparity between employment and self-employment).

The Taylor Review is just that, a review and set of recommendations, rather than a draft legislative programme. It remains to be seen how many of its recommendations are implemented by Government (given the pressures of Brexit upon governmental and parliamentary time) and quite in what form – often, in employment matters, the devil is in the drafting detail. However, there are a number of points of interest for charities and third sector employers within the proposals.

Hugh More Special Counsel | London

Category: Article

Client types: Charities and non-profit