Lord John Hendy QC – The Status of Workers Bill.

Lord Hendy’s bill The Status of Workers Bill was introduced to the House of Lords on the 26th May 2021. It is…

“A Bill to make provision for the creation of a single status for workers by amending the meaning of “employee”, “worker”, “employer” and related expressions in the Trade Union and Labour Relations (Consolidation) Act 1992, the Employment Rights Act 1996 and cognate legislation; and for connected purposes.”

It has had its first reading, and the second reading is scheduled for the 10th September 2021 – you can track the status of the bill here, though no one is very confident that it will end up on the statute book.

It was based on a 2019 pamphlet from The Institute of Employment Rights called ‘Rolling out the Manifesto on Labour Law’.

As a union, we have to look at the tax issue quite closely. Some personal observations: (just my quick notes here):

  1. employment status is often as much about reducing workers’ bargaining power as it is about avoiding risks (see subsequent points) but…
  2. self-employment is a way of avoiding risks – not just on employment rights, but also on Employer’s NICs and other employment-related costs
  3. it means that workers subsidise employers by owning many of the ‘tools of the trade’ (to a value of anything from £100 up to some six-figure sums), owning transport that is used for more than just ‘the commute’, and they remove other risks and expenses – often paying small bills – supplying ‘comsumables’ (so makeup, or batteries etc). They’re often members of ‘the contingent army‘….
  4. workers often don’t perceive employment rights to be valuable – even as a PAYE freelancer (a status that has been around for a long time but got very noisy during the pandemic), you have full employment rights but they’re really not enforceable because of your poor bargaining position
  5. as such, freelancers don’t value employment rights (in the same way that people don’t value other insurances) until they need them – and the pandemic showed a few people that they needed them – particularly the ‘forgotten freelancers’ – when IR35 hit in recent years members were up in arms in defence of their self-employed status because they value the tax benefits more than they value the employment rights
  6. The more you look at the tax status issue neither the tax people or the workers benefit – it’s ‘engagers/employers’ and accountants. One of the big issues for us, as a union, are concerns around complex intermediaries and the value that they take out of employment relationships.
  7. some freelancers actually value their self-employed status because it actually increases their bargaining power. As a union, we have managed to organise freelancers in pursuit of quite good terms and conditions, though these are often led by high-status groups who are well organised, and it happens in the light of a tight labour market.

Because of the way that self-employment shifts bargaining power, and shifts rights away from workers, the UK economy is unusually dependent on workers who have not been in their current job for more than two years (I need to find these figures though). There’s this ILO report [pdf], and…

Further note to self: I should look more at Agency Worker Rights and how some rights are often ‘reset’ when a period of employment ends – which stops people from accruing some rights over time.



This entry was posted in Employment Contracts, Employment intermediaries, Employment Law and Rights, Employment status, Freelance working, Freelancer rights, Gig economy workers, IR35, Personal Service Companies and tagged , . Bookmark the permalink.

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