The Government has launched four consultations regarding the future of work following on from the recommendations of the Taylor Review.

ARC has responded to three of the consultations on behalf of its members. The three consultations were Agency Workers; Enforcement of Employment Rights and Employment Status. The fourth consultation was related to transparency in the labour market and was designed to be responded to by employers with direct experience of certain aspects of employment practices.

ARC’s response to the first two are summarised below:

Agency Workers

The Government is proposing the introduction of a key facts page that Agency Workers will be entitled to receive when they register for work finding services.

  • The ARC response disputed the need to provide work seekers with this additional information pointing out the existing requirement to supply detailed information in accordance with s14 and 15 of the Conduct Regulations. It was also pointed out that where workers are engaged as employees through umbrella companies they would be entitled to a statement of particulars of employment and that there are alternative proposals to extend this right to workers as well as employees. As such this would increase the administrative burden on recruitment businesses and would not be of any significant benefit to work seekers.
  • However it was agreed that where the workers are paid by a third party they should be made aware of who is responsible for paying them, the payment details, including gross sum received from agency, deductions for services etc. Restricting the right to the information to those who are paid by third parties would achieve many of the desired outcomes whilst keeping the burden on the industry to a minimum.

The Government also wanted opinion on what could be done to ensure that this ‘key facts’ information was understood.

  • ARC pointed out that there was in practice very little that businesses could do in this regard and there should be no greater obligation placed on business other than to ensure that the work seeker had signed to say they had received and read and in many cases even this may prove overly burdensome.
  • ARC pointed out that the issuing of these pages could have a significant administrative burden, particularly on smaller businesses.

 The Government also sought opinions on the use of umbrella companies

  • ARC pointed out that whilst most recruitment businesses used umbrellas, this was for ease of payroll management and that it was rarely used as an exclusive model and various options were provided. There were some issues where agencies have paid umbrellas for workers’ services but umbrellas have not paid the worker, e.g. where umbrella has gone out of business.

Proposal to extend remit of EAS to umbrellas

  • ARC rejected this proposal as umbrellas do not perform same function as recruitment businesses. Whilst they should be regulated this should be done by a body with expertise in payroll and tax issues.

Proposal to scrap pay between assignments (Swedish Derogation)

  • ARC felt that there was no particular reason to scrap this. This may also result in loss of rights for some agency workers.

Proposal to increase state enforcement for agency workers’ rights.

  • ARC responded that there was no requirement for increased enforcement of agency workers’ rights.   There is no significant evidence of widespread non-compliance.

Enforcement of Employment Rights

Proposal to increase role of HMRC in enforcing core employment rights

  • ARC response: this was likely to increase administrative burden. In addition this was only likely to be effective if sufficient resources were allocated and that it was thought that this was unlikely to happen.

Proposal that enforcement of Tribunal awards should be simpler by making them directly effective

  • ARC response: this was agreed as the need to go through County Court system was unnecessarily bureaucratic.

Opinion was sought on what was greatest barrier to employees not receiving correct payment.

  • ARC considered that this was largely result of confusion relating to status, and that clarifying law in relation to status would assist with this.

Proposal to name employers who fail to pay Tribunal awards

  • ARC response: this would not be effective and may result in injustice.

31 May 2018

Employment Status 

ARC Introductory Statement

Here we set out our introductory thoughts in principle, answers to the individual questions then following accordingly.

Our approach is from the perspective of a representative of employment agencies that service a considerable number of employers in the UK. We use the term ‘employer’ in the loose sense to refer to any person/business that hires another person to undertake work. We are familiar with most models that employers attempt to use when engaging individuals to provide work services whether via businesses such as our members, or using alternative methodologies. We are also familiar with models used by other businesses using modern technology, namely app based, for example Uber.

The issue of status is central to the concept of flexibility. It is not thought that a model under which everyone engaged by an employer is an employee with employment rights. It is perfectly open to any employer today to hire every person with which it works on an employed basis, whether it be for full time, part time, minute by minute, casual or otherwise. Limb B workers referred to in consultation could easily be hired as employees whatever the working arrangement. There is absolutely no bar to that happening, save choice.

We believe that choice and flexibility is the single most important aspect that differentiates the way we operate in the UK from the way other countries, such as France, operate, and is a major asset. We should not abandon flexibility but we do agree that a good deal of tidying up is required as suggested in the Taylor Report, which we address in this response.

We believe the correct way to approach the issue is not from the perspective of redefining employment rights and definitions, although we agree that modernisation is required in that respect, but from the opposite end, by looking at what is a business that is entitled to tax breaks, non-business individuals then falling to be either employees or limb B workers.

Tax and rights are the two reasons behind the decision of every employer or individual to designate status as other than employment. With the onset of social media and the internet, everyone now knows of the tax benefits that are available to businesses, the claim to have a business is facilitated by the ease of buying a company via the internet for a tiny sum, and the rules for establishing whether a business actually exists have become confused. This gives us the indicator for this response and our position in this response.

Employers use our members and the recruitment industry as a whole in various different ways:

  • for the introduction of individuals to be employed (Class A individuals)
  • for the introduction of individuals who work through companies (Class B individuals) or who claim self-employment, where neither the individual nor the employer wish to have an employment relationship
  • for the supply of individuals who are agency workers, on contract to the supplying agency or a third party (Class C individuals)

Employers also hire Class A and B individuals directly (albeit if there is a company the contract may be with the company to secure the services of the individual).

Business / Self Employment

  • The most important aspect is assessing whether there is genuine business (Class B individuals)
  • Whether genuine self-employment exists should depend upon whether there exists a genuine business.
  • The simple existence of a company, a claim of self-employment or the day to day working arrangements of an individual should no longer determine tax status.
  • There should be business tests which, when they are satisfied and apply, should result in suitable tax test, assessing whether there is a genuine business
  • The core for this test should be the evidence of entrepreneurial activity, such as, is there financial risk or ability to profit, does the business offer its services to the world, does or can the business employ others to provide its services and does the business have a clear and separate identity?
  • Businesses, that satisfy the test, should be afforded tax incentives and there would be no question of employment rights.
  • Accordingly this would avoid the need for others to be involved in assessing tax status, such as under the public sector tax rules set out in Chapter 8 Part 2 IEPTA. A simple switch of the IR35 rules to require the party alleging a business status to prove it would allow agencies and public sector hirers to pay gross if the contractor wants to be paid that way, without any loss to HMRC.  At the same time it would encourage business confidence in the use of contractors who are genuine businesses. The simple reversal of tax tests as we suggest would mean that the IR35 rules would be a thing of the past and the proposal to extend the public sector rules to the private sector, which threatens to destabilise the entire supply industry, would not be needed with consequent savings to all including HMRC.

We believe all these issues should be considered before any change to employment tests are made.

Agency Workers

  • Flexibility of the workforce is a major asset to the UK. Agency workers play a key part in that flexibility.
  • There should be a separate category developed for class C workers such as agency workers who could be clearly defined and should be afforded tax benefits and limited rights, in comparison with regular employees.  Agency workers have little security of work yet contribute enormously to our socio economic make up
  • Agency workers should be helped with travel costs as they move from one job to another. We therefore believe travel tax relief should be re established
  • There would be little incentive for employers to switch regular employees to agency worker status because the cost of using an agency is invariably higher.
  • Individuals in the Class C category have the benefit of rights under the AWR and existing worker rights, with protection under the Agency Conduct Regulations. There is no need for further rights to be afforded.
  • Class C workers, should not be entitled to, or be able to claim, employment rights against a third party hirer.

Gig workers

  • Gig workers, where there is a tripartite arrangement, should be in in the same tax category as agency workers
  • ss.44-47 ITEPA should therefore apply to the tax arrangements of such workers. There is a tripartite arrangement that falls directly into those sections.

Employees

  • All other individuals could be regarded as employees (this would include class A individuals and Class B individuals who do not operate a genuine business and do not belong to a defined class C group)
  • Their income should be taxed accordingly with rights being afforded depending on continuity of service

For the above reasons we see the key to the future of employment status is, in summary

  • understanding what is or is not a business (applying to both companies and individual self- employment). A ‘business test’ should be developed that could assess whether there is a genuine business identity, looking at factors such as, is there financial risk or ability to profit, does the business offer its services to the world, does or can the business employ others to provide its services and does the business have a clear and separate identity?
  • setting in stone tax break rules that support genuine businesses and not others, there would be no question of employment rights for this group –
  • establishing a separate ‘Class C’ category of worker who should have tax break support of some kind, clearly different from genuine businesses, with maybe some additional rights to avoid exploitation – here we say agency workers are clearly such a class not the least because they already operate under the AWR regime and agencies are separately regulated,
  • treating all other workers as employees.

We do wonder whether this consultation is the right approach. The level of detail and range of questions raised is very significant. We believe the correct forum for decisions of this kind is Parliament, that it should be the decision of the country rather than any one government department. We say the tax rules should be set in stone by a decision of this kind because in recent years some who are genuinely self- employed or operate a genuine business have been taxed as employees, and others who would be employees were it not for the existence of the anomalies, have been treated favourably as tax break beneficiaries much to the chagrin of genuine businesses and a loss to the Exchequer.

Tax status should also determine employment status. Why should someone who pays employment taxes not have the benefit of employment rights, unless they fall into a specific class as discussed above?

The outcome of such a debate we believe would be a rebalancing in favour of proper tax treatment, a levelling of the playing field for all, and an encouragement for genuine entrepreneurial business, providing confidence for all businesses for the long terms future.

Over the years we have consistently argued that the rules relating to determination of employment status should be modernised.  We believe the consultation is a step in that direction. However we argue now that if the steps we suggest in this response are taken the rules on determining employment status would be confined to genuine cases of confusion (where the courts have amply set out the rules that apply) and not be as a result of tax status claims.

ARC Response to Questions

Q1: Do you agree that the points discussed in this chapter are the main issues with the current employment status system? Are there other issues that should be taken into account?

We agree that the position concerning both employment status, status designation (i.e. limb B worker or self-employed) and tax relevant to status should be reviewed. The law around employment status is complex and this is compounded by the fact that many working arrangements are themselves complex in nature. Also it can often be difficult for experts and courts to correctly apply the employment tests; it is therefore understandable that many workers and employers are unsure as to status, except where the contract is clearly stated to be an employment contract.

It is also unhelpful that the tests for tax and employment rights can be inconsistent

We believe that the Government should consider whether the existing tests, developed in a very different labour market, should be reconsidered in light of modern working practices.

It may be that where there is an issue about status the emphasis should be changed to concentrate on whether there is a business and, if someone is in business on their own account they are self-employed, there should also be a separate class of workers such as agency workers (Class C workers) by default then others would be classed as employees.

However we think that if there are clear tests for self-employment, rather than employment the position would be clearer. The rules for establishing employment in the absence of a written contract to that effect should be more straightforward.

Principles such as mutuality of obligation in particular require clarity. It is arguable that mutuality exists in every contract but our understanding is that the principle exists where there is an obligation on the employer to offer, and the employee/worker to undertake, continuing work during the relevant period. This does not necessarily suit occasional work.

The main rights that an employee has over a worker is the right to unfair dismissal, redundancy, minimum notice periods, and rights surrounding maternity etc., many of these rights are dependent upon minimum levels of service. On the face of it little clarification is required in this area. However some workers may believe that they are employees if they have been engaged for 2 years and are dismissed or if they are dismissed earlier on grounds that allow for day one unfair dismissal claims The circumstances surrounding this area therefore should be clarified and it is unclear as to whether such a distinction between worker and employee continues to serve a useful purpose.

We also believe that particular groups of workers, who can be distinguished from both the genuinely self-employed and employees and may have other specific rights over and above those afforded to other workers, should be seen as a different class and accordingly be afforded a separate legal status. The most obvious example of this is agency workers who have the benefit of the Agency Workers Regulations. As agency workers they have greater rights to equal pay than regular employees, yet as things stand they are treated no differently from other workers when it comes to the entitlement to allege employment against end user hirers with which they have no direct contractual relationship. This anomaly should be remedied. Looking at the bigger picture an obvious factor appears. If the worker has no direct contractual relationship with the user of the workers services it is difficult to see how that worker could be an employee of the user. Therefore those working indirectly should be classified separately, The Employment Agencies Act would capture the interposing party that the worker does contract with, and the Conduct Regulations would apply.

Q2: Would codification of the main principles – discussed in chapter 3 – strike the right balance between certainty and flexibility for individuals and businesses if they were put into legislation? Why / Why not?

Codification of the tests to assess employment status may provide for greater certainty and would avoid the need for employers and workers to be aware of significant amounts of case law. However, the legislation would still need to be applied to the facts of individual cases and this may still prove difficult in many circumstances.

If the codification was contained in primary legislation then this could result in an inflexible approach that would remove the Courts ability to apply case law to changing labour market practices.

As stated above it may be preferable to establish a ‘business test’ to identify self-employment

Q3: What level of codification do you think would best achieve greater clarity and transparency on employment status for i) individuals and ii) businesses – full codification of the case law, or an alternative way?

Codification, if it were to occur should be limited to the most significant tests. Full codification of the case law may lead to very complex legislation, reducing clarity and creating more inflexibility.

If there was codification it should be in a form that allowed Courts flexibility i.e. a list that Courts should have regard to when assessing status.

Clear and comprehensive guidance may be preferable to codification.

As discussed elsewhere it is considered that there should be a definition of self-employment that assesses whether there is a genuine business.

There should also be further defined groups, such as agency workers, who are distinguished from the self-employed and employees

Q4: Is codification relevant for both rights and/or tax?

Yes, if codification is appropriate then it should be relevant for both tax and rights.

Q5: Should the key factors in the irreducible minimum be the main principles codified into primary legislation?

To the extent that codification is considered then primary legislation should be limited to the minimum tests. However, even this is problematic for example control and to what extent it is necessary in an employment relationship is not a simple test to apply and there are issues surrounding personal service. Therefore it should be considered as to whether these tests are or should be the irreducible minimum

Q6: What does mutuality of obligation mean in the modern labour market?

Mutuality of obligation is simply something that is necessary to show the existence of a contract. All contracts will have mutuality of obligation. To the extent that it is used in employment then this is most relevant in establishing continuity of employment for the purposes of establishing employment rights that require a certain level of service

Q7: Should mutuality of obligation still be relevant to determine an employee’s entitlement to full employment rights?

Only to the extent that it is necessary to establish continuity of service.

Q8: If so, how could the concept of mutuality of obligation be set out in legislation?

Mutuality of obligation is similar to the concept of consideration. It is simply a matter of testing whether a contract exists. So should be set out in terms that a contract must exist in order for there to be an employment relationship.

Q9: What does personal service mean in the modern labour market?

This concept has become stretched. Many contracts contain substitution clauses. In some instances these are never intended to be used in others their use is extremely limited and not practical.

They can often be used when engaging workers in unskilled or low skilled positions as the employer is less concerned regarding the workers skill level. Thereby, denying some of the most vulnerable workers employment rights.

The widespread use of inappropriate substitution clauses means that the personal service aspect in establishing employment rights is one of those most open to abuse.

Q10: Should personal service still be relevant to determine an employee’s entitlement to full employment rights?

It should be a factor but perhaps always looked at in the whole. For example are other elements of the relationship consistent with employment, is the contract designed to be primarily performed by an individual, or is the individual genuinely in business on their own account which perhaps should be the determining factor.

Q11: If so, how could the concept of personal service be set out in legislation?

If it is set out in legislation then it should be a factor that Courts should have regard to.

 Q12: What does control mean in the modern labour market?

Control is something that can exist in both employed and self-employed situations to a greater or lesser degree. Highly skilled employees may be subject, in practice, to very little control and in some instances may have contractual or statutory independence e.g. a data protection officer. In some self-employed situations the hirer may wish to exert significant control on how and when the job is carried out. Therefore the extent to which control is a useful concept in determining status is questionable

Q13: Should control still be relevant to determine an employee’s entitlement to full employment rights?

Control is a factor and should be of consideration however, it should not be a determining factor. Again assessing whether there is a genuine business concern rather than control should considered to be of greater importance

Q14: If so, how can the concept of control be set out in legislation?

If it is set out in legislation then it should be a factor that Courts should have regard to.

Q15: Should financial risk be included in legislation when determining if someone is an employee?

Yes, financial risk and conversely the ability to profit should be important factors as this often is something that can clearly distinguish an employee from someone on business on their own account.

Q16: Should ‘part and parcel’ or ‘integral part’ of the business be included in legislation when determining if someone is an employee?

There are a huge variety of working relationships, so the extent which some employees are integrated into a workforce will vary considerably. Those working from home or peripetically, for example, may be limited to the extent that they are integrated. Conversely many self-employed individuals will have to report to a named individual and may work closely with employees.

Again this may be a factor that Courts may have regards to.

Q17: Should the provision of equipment be included in legislation when determining if someone is an employee?

The genuinely self-employed will often supply their own equipment. However, they may equally be as likely to use equipment supplied by a hirer.

Employees will usually use equipment supplied but the increase prevalence of bring your own device workplace may mean that this is no longer a factor that much weight can be given to.

Q18: Should ‘intention’ be included in legislation when determining if someone is an employee in uncertain cases?

Intention of the parties may have relevance and again may be a factor that the Courts should have regards to.

Q19: Are there any other factors that should be included in primary legislation when determining if someone is an employee? And what are the benefits or risks of doing so?

The Courts should be able to assess whether the person engaged is in business on their own account. Is there an identifiable business? Does the business use its own terms? Are services provided generally to a range of clients? Does the business advertise its services?

Effectively introduce a test for self-employment that involves assessing whether an individual operates as business

Q20: If government decided to codify the main principles in primary legislation, would secondary legislation: i) be required to provide further detail on top of the main principles; and

  1. ii) provide sufficient flexibility to adapt to future changes in working practices?

If the primary legislation were drafted in such a way that the tests were factors that Courts, amongst others, should have regard to, then this would be sufficient and would provide the Courts with flexibility. However, this could equally be done in Secondary legislation and this may provide even greater flexibility.

By introducing a test to assess whether there was a genuine business and establishing a separate class of workers such as agency workers, we believe that the test for establishing employment would be much more straightforward

Q21: Would the benefits of this approach be outweighed by the risk of individuals and businesses potentially needing to familiarise themselves with frequent changes to legislation?

It is unlikely that the legislation would change with such frequency that this would pose a significant problem.

Q22: Should a statutory employment status test use objective criteria rather than the existing tests? What objective criteria could be suitable for this type of test?

Whilst an objective status test would provide considerable certainty, it is likely that it would be too blunt and could result in perverse outcomes. For example contractors having engagements terminated simply to avoid triggering employment. Similarly requiring employees to perform a percentage of work at the employers premises could negatively impact on those who perform work from home, this could disproportionately affect women.

It is therefore considered that objective tests would be too rigid and would lead to perverse distortions in the labour market

Q23: What is your experience of other tests, such as the SRT? What works well, and what are their drawbacks?

No particular experience of these types of test. It is considered that whilst these tests may provide more flexibility than one off objective tests, they could still prove too rigid and result in perverse decisions

Q24: How could a new statutory employment status test be structured?

Introducing a test for self-employment as previously suggested may prove simpler and more effective. If individuals are neither self-employed nor in another defined group, such as agency workers, then they could be considered employees, by default.

Q25: What is your experience of tests, such as the Agency Legislation tests for tax, and how these have worked in practice? What works well about these tests in practice, and what are their drawbacks?

The SDC test in relation to agency workers is a relatively simple test but for this reason is not particularly effective. Many genuinely self-employed contractors will work under the SDC of a hirer to a greater or lesser extent.

We believe that a simpler and more appropriate test would be an assessment as to whether the contractor is genuinely in business on their own account and whether there is an identifiable business entity.

Q26: Should a new employment status test be a less complex version of the current framework?

Whilst a simpler test would, in theory, be welcome it is unclear whether such a test could be designed that was sufficiently robust to deal with the myriad of often complex working arrangements that exist in the modern labour market. It is considered that a test that focussed on whether there was a genuine business would prove more effective

Q27: Do you think a very simple objective or mechanical test would have perverse incentives for businesses and individuals? Could these concerns be mitigated? If so, how?

As discussed above yes we believe that this would prove a blunt test and would have perverse consequences. The only advantage of having such tests is to provide certainty and attempt to mitigate by, for example, providing for some discretion, would only serve to reintroduce that uncertainty

Q28: Are there alternative ways, rather than legislative change, that would better achieve greater clarity and certainty for the employment status regimes (for example, an online tool)?

Comprehensive and clear guidance would be useful. However an online tool would prove problematic, would business and individuals be able to rely on the results of the tool, assuming the information they enter is correct? If yes how would this work in instances, for example, where a business has been informed that the person they have engaged is a self-employed contractor but an employment tribunal subsequently decides there are a worker and should have been  entitled to holiday pay or HMRC decide that they should have paid employer NICs?

If the results of an online tool cannot be relied upon as a statutory defence then it will provide for uncertainty. If they can then the tool effectively performs, what is now, a judicial function. This could again prove blunt.

Q29: Given the current differences in the way that the employed and the self-employed are taxed, should the boundary be based on something other than when an individual is an employee?

Consideration should be given to introducing a test for the self-employed, in line with previous comments. Where there is a clear business operated by an individual, then that business should be entitled to tax incentives.

The focus should be on whether there is a business rather than complex, convoluted and often unsatisfactory tests to distinguish employed from self-employed

Q30: Do you agree with the review’s conclusion that an intermediate category providing those in less certain casual, independent relationships with a more limited set of key employment rights remains helpful?

Yes, there is a place for workers who whilst not in business on their own account are engaged on a flexible basis. There should be consideration given to establishing a separate class of worker for those such as agency workers

Q31: Do you agree with the review’s conclusion that the statutory definition of worker is confusing because it includes both employees and Limb (b) workers?

Distinguishing employees from Limb (b) workers can be difficult. In practice the distinction is often the fact that with workers there is not a continuing obligation to provide work, but where work has been provided continuously over a period of time e.g. more than two years do they become employees? Therefore a clearer definition that distinguishes employee from worker would be useful and consideration should be given as to whether such a distinction serves any real useful purpose.

Q32: If so, should the definition of worker be changed to encompass only Limb (b) workers?

The definition of worker needs to be clearer. We do not believe that this would provide that necessary clarity. A new definition of a separate class of workers, for example agency workers and perhaps others, who could be clearly distinguished from employees and the self-employed, could provide the much needed clarity.

Q33: If the definition of worker were changed in this way, would this create any unintended consequences on the employee or self-employed categories?

No.

Q34: Do you agree that the government should set a clearer boundary between the employee and worker statuses?

Yes see above.

Q35: If you agree that the boundary between the employee and worker statuses should be made clearer:

  1. Should the criteria to determine worker status be the same as the criteria to determine the employee status, but with a lower threshold or pass mark? If so, how could this be set out in legislation?
  2. Should the criteria to determine worker status be a selected number of the criteria that is used to determine employee status (i.e. a subset of the employee criteria)? If so, how could this be set out in legislation?

iii.        Or, is there an alternative approach that could be considered? If so, how could this be set out in legislation?

Criteria should be lower than that of employees. However, there could be different criteria, for example certain groups of workers could be separately identified as workers e.g. Agency workers.

Q36: What might the consequences of these approaches be?

This would provide for more certainty for both business and workers

Q37: What does mutuality of obligation mean in the modern labour market for a worker?

Lack of continuity of mutuality of obligation is often the main distinction between employees and workers but this is often confusing and serves little useful purpose beyond calculating continuity of service.

Q38: Should mutuality of obligation still be relevant to determine worker status?

No, it is not particularly useful other than in determining continuity of service

Q39: If so, how can the concept of mutuality of obligation be set out in legislation?

See answer in relation to employees above

Q40: What does personal service mean in the modern labour market for a worker?

See response in relation to employees above

Q41: Should personal service still be a factor to determine worker status?

See response in relation to employees above

Q42: Do you agree with the review’s conclusion that the worker definition should place less emphasis on personal service?

Yes. See response in relation to employees above

Q43: Should we consider clarifying in legislation what personal service encompasses?

No this would be too blunt

Q44: Are there examples of circumstances where a fettered (restricted) right might still be consistent with personal service?

Yes, the right should be an unfettered right

Q45: Do you agree with the review’s conclusion that there should be more emphasis on control when determining worker status?

No see response in relation to employees above

Q46: What does control mean in the modern labour market for a worker?

See response in relation to employees above

Q47: Should control still be relevant to determine worker status?

See response in relation to employees above

Q48: If so, how can the concept of control be set out in legislation?

See response in relation to employees above

Q49: Do you consider that any factors, other than those listed above, for ‘in business in their own account’ should be used for determining worker status?

Yes. Is there an identifiable business? Does the business advertise its services? Does the business have or use its own terms? Is there financial risk? Does or can the business employ others?

Aspects of control over a particular job or project may be less relevant than others

Q50: Do you consider that an individual being in business on their own account should be reflected in legislation to determine worker status? If so, how could this be defined?

Yes. There could be a statutory definition of self-employment being someone who is in business on their own account a set of tests should be developed in order to determine this

Q51: Are there any other factors (other than those set out above for all the different tests) that should be considered when determining if someone is a worker?

No

Q52: The review has suggested there would be a benefit to renaming the Limb (b) worker category to ‘dependent contractor’? Do you agree? Why / Why not?

No. This would serve no particular purpose. The definition is important not the label. However, as previously stated, we believe that it would be useful to have a separate class of worker for groups such as agency workers and perhaps ‘gig’ workers.

Q53: If the emerging case law on working time applied to all platform based workers, how might app-based employers adapt their business models as a consequence?

No opinion

Q54: What would the impact be of this on a) employers and b) workers?

No opinion

Q55: How might platform-based employers respond to a requirement to pay the NMW/NLW for work carried out at times of low demand?

No opinion

Q56: Should government consider any measures to prescribe the circumstances in which the NMW/NLW accrues whilst ensuring fairness for app-based workers?

No opinion

Q57: What are the practical features and characteristics of app-based working that could determine the balance of fairness and flexibility, and help define what constitutes work in an easily accessible way?

No opinion

Q58: How relevant is the ability to pursue other activities while waiting to perform tasks, the ability of workers to refuse work offered without experiencing detriment, requirements for exclusivity, or the provision of tools or materials to carry out tasks?

No opinion

Q59: Do you consider there is potential to make use of the data collected by platforms to ensure that individuals can make informed choices about when to log on to the app and also to ensure fairness in the determination of work for the purposes of NMW/NLW?

No opinion

Q60: Do you agree that self-employed should not be a formal employment status defined in statute? If not, why?

No. The Government should consider a statutory definition for genuine self-employment. All other workers would then be either employees or a separate defined class of workers by default

Q61: Would it be beneficial for the government to consider the definition of employer in legislation?

Defining employer would, it is considered prove difficult may add more complexity and serve no useful purpose.

Questions about points made or to arrange any follow up meeting should be addressed to Adrian Marlowe (adrianm@arc-org.net).

The Association of Recruitment Consultancies

1st June 2018