Taylor Review begins in depth look at self-employment

Matthew Taylor was in the national spotlight on Tuesday, appearing on TV, radio and in print to discuss a review commissioned by Prime Minister Theresa May to investigate modern employment practices. IPSE was invited to attend the first of ten public evidence gathering events, in a nationwide tour, at Google’s campus in London.

Self-employment is central to this review. Taylor - the Chief Executive of the Royal Society of Arts - has recognised that the flexibility this way of working offers individuals and clients is “a good thing”. He did, however, express concerns that some companies are “deliberately using so-called gig workers to avoid paying contributions to the Treasury”. IPSE largely agrees with this assessment. Self-employment is a positive choice for our members and the vast majority of the self-employed workforce. There are, however, unscrupulous companies exploiting individuals who should not be genuinely self-employed.

This focus on tax receipts is not going away. At the Autumn Statement the Chancellor argued that self-employment was costing the exchequer £2.1 billion. In addition, last week, respected think tank the Institute for Fiscal Studies published an in depth report exploring the issue of tax receipts and self-employment. IPSE is robustly defending the huge contribution that independent professionals make to the economy, offering unique, flexible, broad expertise while having to foot the risk and expense of running their own business. We must also call out those exploitative companies using the complexity around employment status to deny workers the employment protections they deserve - leading to a shortfall in tax receipts.

A crucial part of IPSE’s engagement with the review will be developing a mechanism predicated on providing greater clarity over employment status, helping both the individual and their client. This will offer a practical way of defining whether an individual’s contract and working practices should be considered self-employment. This system can be easily understood and tested by both individual and client alike. This work will provide a framework to help shed light on bad practices and make it easier for the Government to act, while clearly distinguishing the vulnerable from the genuinely self-employed.

The diversity of self-employment was well highlighted at Tuesday’s event with a range of speakers from large trade unions GMB and BECTU, and business organisations including the IoD and APSco. The GMB was keen to highlight the struggles that those in the gig economy are facing, while APSco emphasised that the contractors they deal with are generally high-skilled and do not desire more protections. This is a key point the review must not ignore – the self-employed population are a diverse workforce and potential solutions for one segment may not make sense for another.

However, we will also use the review to make the case for action to improve support for the self-employed in some key areas, including saving for retirement and the accessibility of training. As well as a written submission, IPSE has been asked to appear before a Taylor Review panel in Coventry in March where we will make a strong public case for the need for greater clarity over what is, and isn’t, self-employment.

Taylor is also very keen for those at the coalface to give their views, and there is an online discussion board where the self-employed are encouraged to contribute. The discussion board also contains details of public events which are taking place across the country over the next three months which you are welcome to attend.

The review is expected to conclude in early summer. The next few months, therefore, are crucial in helping shape how self-employment is considered by the Government and approached from a regulatory point of view. IPSE will be focusing on the need to really tackle the confusion around employment status, ensuring the vast ranks of the happily self-employed are recognised and supported while those exploiting the system are identified and made to change their ways.
 

Policy

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