Labour has a proud history of standing up for workers’ rights and using the powers of Government to protect those rights in law.
I am proud to live in a country where people have a minimum wage, paid holidays, maternity and paternity leave, and time off when you are ill.
These are things many of us take for granted, but they were hard fought for over many years. Before I got into politics I remember negotiating with my employer at a local factory to provide a sick pay scheme, to prevent people having to literally work until they dropped.
A lot has changed since then, but new types of employment are putting those rights at risk. Just in the last few days there have been reports of workers being fined £150 a day for being ill. We must address the problem of false self-employment in the so-called “gig economy” and ensure basic rights for workers are not eroded.
What is false self-employment?
There are two broad classifications of work. If you are self-employed you own your own business. If you’re an employee then you work for someone else and they have additional responsibilities towards you as their employee.
False self-employment occurs when you are treated as a contractor even though you have little or no freedom. You are an employee of the company in all but name. It is used by some employers to evade taxes and take on workers without having to respect employment rights and entitlements.
Workers engaged in false self-employment miss out on rights such as:
Paid sick leave
National Insurance contributions
This is not a new problem. It has been prominent in the construction industry and I am proud of the work Labour has done in the past to try and address this. Unfortunately it is becoming a bigger issue across different types of work as new technologies allow for new models of employment.
The gig economy
The gig economy refers to employment where instead of receiving a regular wage from their employer workers get paid for the “gigs” they do, such as a food delivery or a car journey.
In theory this model should empower workers. You can have flexible hours, work when and how much you want to, receive an income from multiple sources, and balance work around other commitments in your life.
In practice though we have seen some employers take advantage of this by wrongly classifying workers as self-employed. They are not empowering workers, they are stripping away their security and their basic rights as employees.
There have been several high profile examples of these employment practices being questioned, including Hermes, Deliveroo, City Sprint and Uber. This business model continues to grow and will undoubtedly play a role in new emerging industries and the Government needs to take action now to stop workers falling into the false self-employment trap.
I have been questioning Government Ministers about false self-employment and I am pleased to see that they have launched a review to see how these issues can be addressed. I am concerned, however, that the main focus of the review is likely to be lost revenue for the Treasury, rather than the protection of workers’ rights.
I am keen to hear from any local residents who may have been affected by these issues.