United Kingdom: Latest working life developments – Q1 2017
The latest developments on Brexit, employment rights following the UK’s exit, figures on zero-hours contracts and in-work poverty, and legal developments on the ‘gig economy’ are the main topics of interest in this article. This country update reports on the latest developments in working life in the UK in the first quarter of 2017.
Developments on Brexit
The Prime Minister, Theresa May, formally triggered Article 50 on 29 March, beginning the official two-year period for the UK to withdraw from the EU. Concerns over future deregulation of labour rights following Brexit had intensified earlier in the year, following a speech by the Prime Minister on 17 January. She warned against the EU inflicting a punitive deal on the UK, saying this would lead to the UK refusing such a deal and then cutting taxes in order to attract global foreign direct investment. The opposition Labour Party condemned the possibility of a ‘hard Brexit’ and the ensuing outcomes, saying that the threat to create a ‘low-pay tax haven on the shores of Europe’ would lead to a dilution of workers’ rights. These concerns have particular resonance in the light of calls from a number of Conservative MPs for a reduction in such rights following Brexit. However, in the Prime Minister’s statement to Parliament on 29 March, she re-affirmed that the government would ‘ensure that workers’ rights are fully protected and maintained’.
On 30 March, the government published a White Paper on its proposed Great Repeal Bill. This will repeal the 1972 European Communities Act but will ensure that all extant EU legislation, including that on employment rights, will be transposed into domestic law on the day of Brexit. Although the Bill will also create the necessary powers for MPs to change these laws once Britain has left the EU, there are concerns over the so-called Henry VIII clauses, which would give the government powers to repeal legislation without parliamentary approval. On this point, the Trades Union Congress (TUC) argues that the Repeal Bill proposals fall short of the Prime Minister’s pledge to protect EU-derived workers’ rights, pointing out that the long-term protection of rights is not guaranteed. The TUC also highlights that, as the Repeal Bill will end the jurisdiction of the Court of Justice of the European Union (CJEU), the UK Supreme Court could have the power to overturn key CJEU decisions on workers’ rights without the need to secure parliamentary approval. Thus, the TUC calls for the inclusion of clauses guaranteeing the long-term protection of employment and equality laws.
Increase in the number of zero-hours contracts
In March, the latest figures (October–December 2016) on the number of people employed on zero-hours contracts in their main job were published. The figure is 905,000, representing 2.8% of all employment. This latest estimate is 101,000 higher than that for October–December 2015 (804,000). Moreover, recent analysis by the TUC has found that the number of insecure workers in the UK increased by 27% (or 660,000 workers) between 2011 and 2016. The study found that more than three million people are now in some form of insecure work, including seasonal, casual, temporary or agency work, those on zero-hours contracts and low-paid self-employed workers.
One in eight workers living in poverty
The Joseph Rowntree Foundation’s annual Monitoring Poverty and Social Exclusion 2016 report found that in the UK one in every eight workers is living in poverty (some 3.8 million people). Since 2010–2011, in-work poverty has increased by 1.1 million.
Employment in the ‘gig economy’ – tribunal victories
Following the GMB’s employment tribunal win for Uber drivers in 2016, two other cases have subsequently secured similar rulings. In March 2017, an appeal by Pimlico Plumbers was dismissed and a former ‘contractor’, Gary Smith, was confirmed as having the employment status of ‘worker’. Smith’s agreement with the company was terminated in 2011 after he had a heart attack. He had claimed for a range of employment rights and disability discrimination, as well as for unfair dismissal. The Employment Tribunal and the Employment Appeals Tribunal concluded that, while Smith was not an employee, he was a worker. The Court of Appeal has now backed that decision.
The Independent Workers Union of Great Britain (IWGB) has won a similar tribunal case against courier firm, CitySprint. The firm classified couriers as independent contractors, denying them basic rights such as paid holiday leave. The tribunal agreed with the union, describing CitySprint’s business model as ‘indecipherable’ and as ‘window dressing’ intended to conceal couriers’ status as workers. IWGB will now ask three other courier companies, against whom they have claims pending, to concede defeat.
IWGB, representing couriers working in Camden for Deliveroo, the app-based takeaway delivery firm, has lodged a statutory recognition claim with the Central Arbitration Committee (CAC). In November, Deliveroo rejected a voluntary request from IWGB. For the statutory case to proceed, the CAC must first decide that Deliveroo drivers are workers, as opposed to ‘independent contractors’ as claimed by the company.
These developments – continued questions over employment rights, growth in precarious work and in-work poverty, alongside a small number of successful cases against exploitative employers within the gig economy – are particularly interesting in light of the Taylor review of modern employment practices, commissioned by the Prime Minister. The review by Matthew Taylor, the Chief Executive of the Royal Society of Arts, will consider how employment practices need to change in order to keep pace with business models and new forms of work driven by digital platforms. It will also examine employee rights, employer freedoms and existing employment regulation. The report is due to be published in summer 2017.