The Labour Party manifesto has identified umbrella companies as a blight on employment taxation and limiting workers’ rights and has pledged to ban them should it be voted into power on 8th June.
Whilst Labour acknowledge that self-employment is a vital and entrepreneurial sector of the UK economy, its plans for re-shaping its makeup are geared towards workers’ rights. The party say that there is mounting evidence that workers are being forced into self-employment by unscrupulous employers to avoid costs and their duties to workers. They therefore intend to clamp down on bogus self-employment by:
Recognising that the law often struggles with the ever-changing new forms of employment and work, Labour would establish a dedicated commission to modernise the law around employment status. The commission would be led by legal and academic experts with representation from industry and trade unions.
New statutory definitions of employment status would also reduce the need for litigation and improve compliance.
The Tories also want to ensure that those working in the ‘gig’ economy are properly protected but intend to wait until the publication of the Taylor report until they decide on a course of focused action.
The Taylor Report will also influence Liberal Democrat modernisation of employment rights to make them fit for the ‘gig’ economy.