It sounds like change is coming to Britain’s gig economy.
The Conservatives and Labour have now published their manifestos ahead of June’s general election, and both promise to take action on self-employment and the workplace protections.
While both say they will act to protect workers’ rights, Labour goes into significantly more detail, with plans for tough new measures to “clamp down” on what it describes as “bogus self-employment.”
(You can read their full positions on the subject below.)
The “gig economy” is a broad term that refers to growing numbers of people who work on a job-by-job basis, without any formal boss. This includes the workforce of companies like Uber and Deliveroo, who can select when they work and are managed via a smartphone app, as well as professionals working on a freelance basis.
The sector is under increasing scrutiny in Britain, and has been the subject of multiple high-profile legal battles. While its defenders argue that the model can give people more freedom and let them choose when and how they work, detractors counter that it can simply be a way to avoid giving workers the rights and protections they would otherwise be entitled to.
In its manifesto released Thursday, Theresa May’s Conservative Party wrote that the gig economy “brings considerable advantages to millions of people but we should not ignore the challenges this kind of employment creates. These workers are officially classed as self-employed and therefore have fewer pension entitlements, reduced access to benefits, and no qualification for sick pay and holiday pay.”
It says it will “make sure that people working in the ‘gig’ economy are properly protected” — but stops short of promising any specific changes. Instead, it says it will await for the final report from a review into the labour market led by Matthew Taylor.
In contrast, Jeremy Corbyn’s party never actually uses the phrase “gig economy” in its manifesto — but promises changes to employment law that would have significant implications for the sector.
“Self-employment can bring many benefits, freedoms and flexibilities to people — and is a vital and often entrepreneurial sector of our economy,” the left-of-centre party says. “But there is also mounting evidence that workers are being forced into self-employment by unscrupulous employers to avoid costs and their duties to workers.”
Labour intends to “[shift] the burden of proof, so that the law assumes a worker is an employee unless the employer can prove otherwise.” It will create a new Ministry of Labour and it will fine employers for “not meeting their responsibilities.”
It seems probable that these new labour protections would hit companies like Uber hard, which lost a legal case over the status of its workers in 2016. (It is currently appealing.) They’re pledges that will likely be welcomed by many workers in the gig economy — but the companies themselves may not be so keen.
Here’s what the Conservative manifesto says in full:
Rights and protections in the ‘gig’ economy
In the modern economy many people choose jobs like driving, delivering and coding, that are highly flexible and can be mixed with other employment. This brings considerable advantages to millions of people but we should not ignore the challenges this kind of employment creates. These workers are officially classed as self-employed and therefore have fewer pension entitlements, reduced access to benefits, and no qualification for sick pay and holiday pay. Yet the nature of their work is different from the traditional self- employed worker who might be a sole trader, a freelancer or running their own business.
We will make sure that people working in the ‘gig’ economy are properly protected. Last October, the government commissioned Matthew Taylor, the chief executive of the Royal Society of Arts, to review the changing labour market. We await his final report but a new Conservative government will act to ensure that the interests of employees on traditional contracts, the self- employed and those people working in the ‘gig’ economy are all properly protected.
And here’s the Labour Party:
Self-employment can bring many benefits, freedoms and flexibilities to people — and is a vital and often entrepreneurial sector of our economy.
But there is also mounting evidence that workers are being forced into self-employment by unscrupulous employers to avoid costs and their duties to workers. Labour will clamp down on bogus self-employment by:
- Shifting the burden of proof, so that the law assumes a worker is an employee unless the employer can prove otherwise.
- Imposing punitive nes on employers not meeting their responsibilities, helping to deter others from doing the same.
- Involving trade unions in enforcement, e.g. by giving them a seat on the executive board of the new Ministry of Labour.
- Giving the Ministry of Labour the resources to enforce all workers’ rights.
- Banning payroll companies, sometimes known as umbrella companies, which create a false structure to limit employers’ tax liabilities and limit workers’ rights.
- Giving employment agencies and end-users joint responsibility for ensuring that the rights of agency workers are enforced.
- Rolling out sectoral collective bargaining and strengthening trade union rights, because empowering people to claim their own rights in the workplace is the most effective means of enforcement.
We would also extend the rights of employees to all workers, including shared parental pay, making a substantial and immediate difference to the quality of life of people in insecure work. But there are real concerns that rapid changes to the world of work are rendering existing employment categories outdated.
Labour recognises that the law often struggles to keep up with the ever-changing new forms of employment and work, so we will set up a dedicated commission to modernise the law around employment status. New statutory definitions of employment status would reduce the need for litigation and improve compliance.
The commission will be led by legal and academic experts with representation from industry and trade unions.