Good Work report and Government response: the Taylor Review of Modern Working Practices

All work in the UK economy should be fair and decent with realistic scope for development and fulfilment, says the July 2017 Taylor Review of Modern Working Practices (pdf).

The Government responded to the Taylor review (pdf) in February 2018.

The review considers the implications of new forms of work on worker rights and responsibilities, as well as on employer freedoms and obligations. It sets out seven principles to address the challenges facing the UK labour market.

Business Minister Margot James said:

‘The Taylor review is a hugely important step towards us ensuring fairness for everyone in work. Helping us to understand what impact modern employment practices have on workers will inform our forthcoming industrial strategy and also help us ensure our labour market and wider economy works for everyone.’

The seven principles are:

  1. Our national strategy for work – the British way – should be explicitly directed toward the goal of good work for all, recognising that good work and plentiful work can and should go together. Good work is something for which Government needs to be held accountable but for which we all need to take responsibility.a) The same basic principles should apply to all forms of employment in the British economy – there should be a fair balance of rights and responsibilities, everyone should have a baseline of protection and there should be routes to enable progression at work.b) Over the long term, in the interests of innovation, fair competition and sound public finances we need to make the taxation of labour more consistent across employment forms while at the same time improving the rights and entitlements of self-employed people.c) Technological change will impact work and types of employment and we need to be able to adapt, but technology can also offer new opportunities for smarter regulation, more flexible entitlements and new ways for people to organise.
  2. Platform based working offers welcome opportunities for genuine two way flexibility and can provide opportunities for those who may not be able to work in more conventional ways. These should be protected while ensuring fairness for those who work through these platforms and those who compete with them. Worker (or ‘Dependent Contractor’ as we suggest renaming it) status should be maintained but we should be clearer about how to distinguish workers from those who are legitimately self-employed.
  3. The law and the way it is promulgated and enforced should help firms make the right choices and individuals to know and exercise their rights. Although there are some things that can be done to improve working practices for employees, the ‘employment wedge’ (the additional, largely nonwage, costs associated with taking someone on as an employee) is already high and we should avoid increasing it further. ‘Dependent contractors’ are the group most likely to suffer from unfair onesided flexibility and therefore we need to provide additional protections for this group and stronger incentives for firms to treat them fairly.
  4. The best way to achieve better work is not national regulation but responsible corporate governance, good management and strong employment relations within the organisation, which is why it is important that companies are seen to take good work seriously and are open about their practices and that all workers are able to be engaged and heard.
  5. It is vital to individuals and the health of our economy that everyone feels they have realistically attainable ways to strengthen their future work prospects and that they can, from the beginning to the end of their working life, record and enhance the capabilities developed in formal and informal learning and in on the job and off the job activities.
  6. The shape and content of work and individual health and well-being are strongly related. For the benefit for firms, workers and the public interest we need to develop a more proactive approach to workplace health.
  7. The National Living Wage is a powerful tool to raise the financial base line of low paid workers. It needs to be accompanied by sectoral strategies engaging employers, employees and stakeholders to ensure that people – particularly in low paid sectors – are not stuck at the living wage minimum or facing insecurity but can progress in their current and future work.

Read the Government’s response (pdf) and press release.

Background

The Prime Minister commissioned an Independent Review of Employment Practices in the Modern Economy in October 2016. Matthew Taylor (the Chief Executive of the Royal Society of the Arts) led the review to consider how employment practices need to change in order to keep pace with modern business models.

The review considered the implications of new forms of work, driven by digital platforms, for employee rights and responsibilities, employer freedoms and obligations, and our existing regulatory framework surrounding employment.