What You Need to Know About the Government Response to the Taylor Review

Way back in October 2016, Theresa May commissioned Matthew Taylor, the Chief Executive of the Royal Society of the Arts and former policy advisor to Tony Blair, to undertake a review of modern working practices. At the time the Prime Minister had a strong majority, Article 50 hadn’t been triggered, and Labour seemed weak. Now in very different political circumstances, following the publication of Taylor’s review in July, the government have responded. Yesterday they announced four consultations, all relevant to the recruitment industry.

The government broadly welcomed Taylor’s review but they decided to consult further on the majority of recommendations contained within it. We at the REC have welcomed this approach. Most importantly for us there will be a consultation on agency work. This is perhaps the biggest consultation our industry has seen for a number of years, and is a great opportunity for you to help shape the future regulations governing our industry.

The government is positive about agency work

On the whole the government’s response was positive about agency work: “Agency workers in the UK play a vital role in supporting delivery in a number of sectors and many people choose this highly flexible approach to work.”

However, it acknowledges that changes in the labour market have put pressure on the current regulatory framework and government wants to ensure these rules reflect the modern labour market. This is something we have been long been calling for and are pleased to see a consultation on this. However, we do have some concerns around some of the unintended consequences around a number of the recommendations and will be raising these with the government.

Here a brief summary of what is discussed in each consultation:

Consultation on agency work

• Transparency of information about pay and deductions provided to agency workers 
• Whether the remit of the Employment Agency Standards Inspectorate (EAS) should be expanded to cover umbrella companies 
• Whether the Swedish Derogation of the Agency Worker Regulations should be removed or enforced by the EAS.

Consultation on enforcement

• Whether HMRC should enforce holiday pay payments
• How to ensure employment tribunals awards are paid fully by employers.

Consultation on transparency

• How to ensure all workers receive a statement of written particulars on day 1
• How holiday pay is calculated
• Whether there should be right to request a ‘more stable’ contact for workers on atypical contacts.

Consultation on employment status

• Issues in current employment status regimes
• Legislating current employment status tests
• How a new statutory employment status test could work
• Definition of working time
• Defining ‘self-employed’ and ‘employers’
• Alignment between tax and rights

The REC chosen to help produce ‘good work’ metric

The government will also be taking Taylor’s ‘good work’ agenda forward to prioritise quality work in the UK labour market. The government will create a metric of ‘good work’ and use this each year to assess how the UK is performing on this measure. The REC was identified by the government alongside the CBI, TUC and CIPD to help produce this and we will be meeting with Matthew Taylor next week to discuss how our industry can embrace his good work agenda.

Input needed from members

We will be going out to members shortly, on each of the consultations, as your input is crucial to ensure we fully represent the industry on these important policy areas. And where we all feel a recommendation would be damaging to the industry we want to present a strong united voice.

If you would like to get in touch, please email policy@rec.uk.com.