Government response to Taylor Review: what happens next?

The Government published its response to last year’s Taylor Review on 7 February 2018. The vast majority of its recommendations were endorsed. But what specific action will the Government be taking to implement them and when?

Ruled out

First, let’s run through the relatively short list of recommendations that Government has ruled out implementing, at least for the foreseeable future: o Expanding the remit of the Low Pay Commission to assess the quality of work as well as looking how much workers should be paid. 

• Taking action to restrict the scope of non-compete clauses (this was not in fact something that the Taylor Review looked at, but was explored in an earlier Government consultation paper). 
• Changing the rate of national insurance contributions paid by the self-employed. 
• Introducing rolled-up holiday pay.
• Reversing the burden of proving employment status so that claimants would be “workers by default” (though this may be revisited if and when other reforms on employment status are implemented).

Immediate action promised

Next here are three areas where the Government has promised immediate action: 

• Unpaid internships: The Government has promised to use its existing national minimum wage enforcement powers to target employers who are in breach by failing to pay interns who qualify as workers. It will also be updating its guidance to ensure that employers understand where the line is drawn between workers and genuine volunteers. 
• Payslips: Regulations have already been laid which will make it compulsory for payslips to specify the number of hours worked where this has a bearing on the total pay employees receive. If there are differential hourly rates, the total number of hours worked must be broken down into the number of hours worked at each rate. These regulations come into effect on 6 April 2019. The Government has promised to introduce similar rules for non-employee workers. 
• Higher penalties for aggravated breach: Currently employment tribunals have the power to impose a fine of up to £5000 where they consider there has been an “aggravated breach” of employment legislation. The Government has promised to raise the maximum fine to £20,000 “as soon as practicable”. It is consulting on other amendments to the employer penalty regime.

Subject to consultation

However, the vast majority of the recommendations in the Taylor Review will now be put out to consultation, as follows: 

• Consultation on agency workers recommendations (deadline 9 May):
  A number of issues are explored here, including whether the so called Swedish derogation should be repealed.
  https://www.gov.uk/government/consultations/agency-workers-recommendations 
• Consultation on employment status (deadline 1 June):
  What if any changes should be made to the legal definitions of employee and worker?
  https://www.gov.uk/government/consultations/employment-status 
• Consultation on enforcement of employment rights recommendations (deadline 16 May):
  How to make enforcement of tribunal awards easier and how better to deter rogue employers who flout the rules? The consultation also explores the possibility of creating central Government enforcement regime to sick pay and holiday pay, and examines how a “naming and shaming” regime could be introduced.
  https://www.gov.uk/government/consultations/enforcement-of-employment-rights-recommendations 
• Consultation on measures to increase transparency in the UK labour market (deadline 23 May):
  How should the Government implement the Review’s proposals on written statements, continuity of employment, holiday pay and information and consultation? This consultation will also explore introducing a new definition of working time for platform workers.
  https://www.gov.uk/government/consultations/increasing-transparency-in-the-labour-market

The Government will also be consulting with the Low Pay Commission on the possibility of introducing a higher rate of the National Minimum Wage for hours that are not contractually guaranteed.
 

More information

For those wishing to explore the Government’s response to the Taylor review in more detail, the following links may be of interest:

• Taylor Review 
• Mills & Reeve's overview of Taylor Review (see also separate postings on our employment blog exploring the Review’s recommendations on "good work"; increasing certainty; enforcement; and employee engagement) 
• Government response to Taylor Review