Keir Starmer faces the very real possibility of becoming only the fourth Labour leader to have won an election since 1900, potentially with a significant mandate from the electorate.
Over the past year, Labour have been vociferous in their attempts to usurp the Conservative’s tag as the ‘party of business’, but have so far largely courted big business.
With the party commanding such a significant lead in the polls, the self-employed will be quite rightly keen to hear their plans for the UK’s smallest businesses, particularly on issues such as tax, employment status and addressing discrepancies within the UK’s support system.
So, what can the self-employed expect from Labour and do their plans go far enough in unleashing the vast potential of the sector?
The document itself is rather lacking in detail when it comes to the self-employed. Instead, it refers heavily to already announced plans, such as their ‘Plan to Make Work Pay: Delivering a New Deal for Working People’.
We already know that Labour are interested in introducing a single worker status, which could be potentially transformative to the way that the UK’s employment status rules work.
Below, we recap what we already know about Labour’s commitments from this plan, that were rather lacking in detail in its Manifesto.
Perhaps not one of the most eye-catching policies but potentially major in its ramifications for the workforce, was the previous commitment to introduce a single worker status.
At IPSE, we’re particularly interested in these plans as the consultation has the potential to fix our current outdated system for determining employment status.
If Labour were to successfully introduce the ‘worker’ and ‘genuinely self-employed’ statuses, it could even remove the current reliance on IR35 case law and potentially lead to client becoming more confident in engaging contractors they consider to be ‘genuinely self-employed.’
Ultimately, this proposal could (if implemented correctly with industry) bring about a greater alignment of tax and employment status which would be widely welcomed; particularly if it improves the application of IR35 case law.
We've previously written about the potential impact of the single worker status proposal on IR35.
Whilst the Manifesto was vague in its detail on how Labour will combat late payment - simply saying that they ‘will take action on late payments to ensure small businesses and the self-employed are paid on time’ - we have heard some detail previously.
In their plan for small businesses, Labour have committed to legally require audit committees of big businesses to report on their company’s payment practices in the company annual report.
In practice, this sounds perfectly reasonable. But, with this representing the only commitment from Labour on late payment so far, it feels rather weak; especially compared to the pledges of other parties.
In comparison, the Lib Dems have already committed to a policy championed by IPSE – to make the Prompt Payment Code mandatory.
IPSE will continue to call for the UK’s standard commercial payment term to be brought down to 30 days and for legislation that would make any terms exceeding 60 days to become null and void – thereby reverting to the standard payment term.
For a comprehensive comparison between the parties of the policies that could affect you as a self-employed individual, we’ve put together an outline of the key announcements from this past week.
Another pledge from Labour is to cap the headline rate of corporation tax at its current rate of 25%, closely aligning with the pledge from the Conservatives to not raise Corporation Tax.
However, with no mention of the current tapered levels of corporation tax for companies with smaller profits in either the Labour Manifesto or in previous pledges, Labour may well look at tweaking these bands in the future.
At IPSE, we’ve been contacting all prospective parliamentary candidates with our manifesto and urging the parties to understand and embrace this sector during this election campaign.
So far, candidates have been receptive to our key asks. But we also need your support in getting this into the hands of our future MPs and getting self-employment up the political agenda on the campaign trail.
The more members we have contacting candidates with these key asks for the whole sector, the more likely we are to see the issues affecting them championed in this election campaign.
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