Gig economy workers – Do they need a special status?
Gig economy worker rights have been the confusing everyone for years.
Since we started talking about this in 2009 the likes of Amazon and Uber have found their idea of how the gig economy works to be different from the UK courts.
The Taylor review is set to be published this week and is expected to formally recommend a series of protections for "gig-economy" workers.
With up to half the workforce expected to be 'gig-economy workers within the next decade, this hot topic is bound to create debate. According to PWC more people would join the gig economy if they were sure of minimum wage rights.
Minimum wage for gig-economy workers?
The draft report says clients/employers will have to demonstrate that their gig workers can earn at least 1.2 times the current National Living Wage.
We predict it will work like piece work. You will need to show that a suitably skilled worker can earn an appropriate amount by testing how long this takes from start to finish.
Fourth status for gig economy workers
The report proposed a new worker status known as 'dependent contractor'.
We don't know if that will apply to individuals, or personal services companies, or across the board.
Until Brexit this must be in addition to the existing three categories of employee, worker, self-employed.
We have no idea whether these recommendations will be adopted, and if so over what timescale.
If the 'dependent contractor' status is created, we won't have clarity on that day about exactly who is included and who is not.
This will take time. Our laws are made by Parliament (Act of Parliament, known as a statute, or a Regulation). Parliament sets out the definitions. But it is only when people take court cases and the appeal courts hear them that we get a body of decisions that interpret that law (case law).
It takes about 5 years to get the first significant decisions through and 10 years or more to get a body of case law that gives us something we can predict.
Don't forget your workers already have the right to National Living Wage. UK law gives them that right now.
There are some things you can do to 'get your ducks in a row'
Gig economy checklist
- Check whether they are invoicing you via a company or just using a business name
- Check the freelancer's base - are they working from the UK?
- Check whether you have a written contract with them
- Get that contract reviewed to establish the status
- If no written contract exists (or an out of date one) update it to properly reflect the arrangements between you.
- Talk to us about how to contract and manage your freelancers in a way that is appropriate for your business