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Labour’s proposal to create a single status of ‘worker’

Jul 29, 2021

We have recently seen a number of key rulings on the status of gig economy workers which considered whether a Claimant should be classed as a worker and therefore entitled to the minimum wage and holiday pay, or whether they were self-employed.

However, Labour have recently announced plans to create a single status of ‘worker’ to ensure workers are entitled to many basic rights that employees are currently entitled to.

Existing Categories

At present, there are three existing categories which each benefit from differing levels of rights and protections and differing qualifying periods to access those rights and protections.

These categories are:

  1. Employee
  2. Worker
  3. Self-employed

Single Status of Worker

If Labour’s plans are implemented, the ‘Employee’ and ‘Worker’ categories will merge to create a single ‘Worker’ category to ensure everyone has the same rights and protections. Therefore, workers will be given many additional rights to bring them in line with employees.

The genuinely self-employed will, however, retain their separate status.

These plans would impact millions of workers in the gig economy and the Labour Party has anticipated that 6.1 million additional working people would be eligible to claim Statutory Sick Pay under these plans.

It should be noted that it is unlikely all basic rights and protections would be available to workers from day 1 of their jobs as providing workers with protection against unfair dismissal from day 1 (as opposed to the current qualifying periods in place) would have far-reaching implications on the law in this area. However, the mechanics of this proposal are yet to be outlined by Labour in a formal policy document which we anticipate will provide clarity on this point.

Obviously the Labour party are not in government and so there may be some time until such proposal becomes law. However, this could be seen as yet more pressure on the government to address these concerns and broaden employment rights beyond those who currently benefit from them.

For further information or to discuss the issues raised by this update, please contact our Employment Group on 0118 977 4045 or employment@herrington-carmichael.com.

Click here to see our ‘Employment Law Figures 2021’ which includes basic figures, time off work, living wage, minimum wage and tax rates.

 

 

 

 

 

 

 

This reflects the law at the date of publication and is written as a general guide. It does not contain definitive legal advice, which should be sought as appropriate in relation to a particular matter.

Darren Smith

Darren Smith

Partner, Employment

Aneesa Zaman

Aneesa Zaman

Trainee Solicitor

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