How will the Taylor review affect your business?

 

The government’s response to the Taylor Review of Modern Working Practices was issued on 7 February 2018. However, there will be more consultation on workers’ rights and it is unclear when we will see Taylor’s ideas crystallised into law.

At the heart of the matter are some very basic questions on employment status. The three categories; employee, worker and self-employed seem self-explanatory but considerable work needs to be done to clarify exactly who can, and should, fall into which category. There will many debates and different options put forward around the best way of defining employee and worker status.

A vital element in this debate will be how the legislation will affect lower paid temporary workers; men and women performing, for the most part, unskilled tasks and supplied through agency contracts.

It would be unwise for companies to ignore this seemingly esoteric debate, assuming the issue is of concern only to organisations in the gig economy, or, most unwise of all, abdicating responsibility to the recruitment agency. Whatever shape the new rules take, the cost of getting the question of status wrong will become much higher and will impact both the supplying agency and their client company.

This cost will not only be measured in money. The government has sign-posted its intention to use naming and shaming as part of its enforcement strategy, creating potentially huge reputational costs to companies with a valuable brand image.

Any organisation with significant numbers of agency workers, especially at the lower end of the pay scale, will be caught by the new rules and enforcement regime. It is vital that businesses get involved in the debate on status and we suggest that the first port of call is the supplying agency.

Companies should seek clarification on the status of their agency workers. In an industry where margins are often in pennies, treating a worker as self-employed avoids the need to pay Employers NI, Holiday pay in line with the Agency Workers Regulations, SSP, SMP and Pension contributions; but can you justify calling someone self-employed when they are working as picker and packer on a production line?

Just Recruitment has been supplying temporary labour for 35 years. They are all paid through a PAYE payroll and are included in the auto enrolment process. All receive paid holiday, SSP and SMP.

In addition, we enrol temps in Just Extra©, our voluntary benefits programme. Where the worker requests it we also register them with our permanent recruitment consultants to find them long term employment.

There are many reasons why a person chooses to take temporary work; whatever the reason, we believe it is essential to treat them in an ethical manner.

If you would like to discuss the issues raised by the Taylor Report, please contact us and we will arrange for our compliance manager to speak with you.

© 2018 Just Recruitment Group Ltd.

Posted on Tuesday Mar 6