In a judgment issued yesterday, the High Court rejected an application for judicial review made on behalf of a delivery company’s riders that they were “workers” for the purposes of statutory collective bargaining. The claim was brought by a new trade union, the Independent Workers of Great Britain (IWGB). This is discussed further below, but this case is only one of many in which trade unions have recently been using the law as a tool on behalf of individuals in the gig economy.
It's been some years since law books had titles like "The Law of Master and Servant". Times change and we don't use those terms any more. But semantics are still important in the area of what in the US we'd call labor law: for example, what does it mean when someone is referred to being employed or self-employed? It's easy to think that a self-employed person pays their own tax and has no employment type rights. That is by no means the case and this confusion was apparent in some media reports of the Employment Appeal Tribunal Addison Lee decision issued last week. "Drivers held to be employees" was a typical headline. In fact, the drivers were held to be "workers" not employees. There is a significant difference in the consequences of being put into one or other of these categories. So what exactly is this difference?
The first question sounds straightforward. After all, legislation was in force well over a hundred years ago relating to people classed as "servants". The courts have been handing down decisions on the issue ever since. Nevertheless, it is fair to say that in many circumstances, it can still be very difficult to categorise someone correctly. There seem to be more tribunal and court cases on the point now than ever. The result is that after all this time, businesses and individuals are faced with uncertainty and lack of clarity on this most basic of questions which affects both their tax and employment rights and obligations.
Whilst the bulk of Government's time is understandably taken up with Brexit, recent stories in the press suggest that the Prime Minister’s aim of building a fairer society will shortly start to manifest itself in some policy announcements.
When the Government announced its response to the Off-payroll working in the private sector consultation in the recent Budget, it came as little surprise that it opted to move forward with its “lead option”, ie the extension of the current public sector rules into the private sector. However, having announced an April 2020 implementation date, the Government seems to have listened to the flood of representations calling for a sensible lead time for the changes.
The best gig I have ever been to, out of hundreds, was a gig by a band called ‘ Pop Will Eat Itself’. Never a well known band - one of their ‘hits’ was a raucous anthem boldly titled ‘ wise up sucker’ - the vocals to this harmonious ditty being roared through a distorted megaphone.
This Summer the Government consulted on the reform of rules governing off-payroll working in the private sector. While we await a formal response to the consultation (expected late Autumn), there has been much speculation about when – not whether – new legislation might take effect.
Director of Labour Market Enforcement estimates 'Wage theft' of over £1.5 billion in the form of unpaid holiday pay
The Government’s response to the Taylor Review (The Good Work Plan) alongside Sir David Metcalf’s publication of his Labour Market Enforcement Strategy for 2018/19 and a number of recent Employment Appeal Tribunal (EAT) decisions have all brought holiday pay right to the top of the agenda for employers across the UK over the last few months.
In Royal Mencap Society v Tomlinson-Blake, the Court of Appeal considered whether workers are entitled to be paid the National Minimum Wage (NMW) for “sleep-in” shifts at work. The case also has wider implications with respect to how the judgment was arrived at, and is therefore of interest to all employers.
The latest list of National Minimum Wage (NMW) breaches was published on Friday 6th July by the Department for Business, Energy and Industrial Strategy (BEIS). It includes nearly 240 employers with total arrears of £1.44m and record fines of £1.97m. The increase in these figures reflects HMRC’s investment in its NMW enforcement activity over the past 18 months.
The whiff of change is in the air for any business that relies on the use of a flexible workforce, whether self-employed or through a personal service company (PSC). As well as HMRC’s increased focus on National Minimum Wage (NMW) compliance, Government scrutiny and recent high-profile legal cases on worker status have brought the issue to the fore and momentum will only build in the months to come. Now is the time for businesses to act to understand the potential risks they face and how they can best be managed ahead of changes taking effect.
Whilst we're awaiting the outcome of the Government's consultation on employment status, anyone with an interest in this issue has also been eagerly awaiting the Supreme Court judgment in Pimlico Plumbers vs Smith, which has now been published.
The long anticipated consultation on the reform of rules governing off-payroll working in the private sector, often referred to as IR35, has now been published. In addition, the Government has published the findings from an independent research project that looked at the immediate impacts on public sector bodies of implementing the reform of off-payroll working in the public sector.
We are pleased to invite you to join us at our seminar focusing upon National Minimum Wage (NMW) enforcement.
The Government announced in February its response to the Taylor Review on Modern Working Practices by issuing four consultations on the concept of what "Good Work". One of these consultations focuses on employment status, which could lead to fundamental changes to the employment landscape and the engagement of contractors. To support businesses in thinking through the impact of the employment status consultation on their plans to achieve an agile and flexible workforce, and provide a forum to give their views, we are hosting a roundtable discussion session in London.
Spring Statement 2018 - Gig economy users in taxman's sights and a missed opportunity on ring-fenced tax
Kevin Nicholson, head of tax at PwC, comments on the Chancellor’s Spring Statement.
Following on from the Public Sector Update for Payroll Professionals which we hosted earlier this month, we are pleased to invite you to a National Minimum Wage (NMW) webinar, taking place on Thursday 15 March at 11:00am.
The tax treatment of off-payroll workers has been an area of significant focus in recent months. Julian Sansum, employment partner at PwC, shares his predictions ahead of the Spring Statement on Tuesday 13th March 2018.
In 2017 we saw unprecedented media attention around National Minimum Wage (NMW) compliance. HM Revenue & Customs (HMRC) which enforces the NMW regulations published the 13th list of NMW offenders in December, identifying 260 employers required to pay back £1.7 million to workers and £1.3 million in penalties. ‘Naming and shaming’ is automatic for any employer found to owe underpayments to workers of £100 or more in total...
In its latest update, a further 260 employers have been "named and shamed" by the Department of Business Energy and Industrial Strategy (BEIS) for failing to pay the National Minimum Wage (NMW). In addition, the level of fines issued by HMRC was the highest ever.
The Chancellor has announced that the government will publish a consultation as part of its response to Matthew Taylor’s review of modern working practices, considering options for reform to make the employment status tests for both employment rights and tax clearer.
We can help you manage your people costs
The long awaited Taylor Review of Modern Working Practices has now been published and is generating a lot of headlines. It's not just those businesses engaging people in the "Gig Economy" or on zero hours contracts that need to consider the changes this r...