Good Work Plan boosts worker rights and abolishes Swedish Derogation

Written by Brabners LLP

 

On 17 December 2018, the government released its Good Work Plan (“the Plan”). The Plan is set to provide workers with more employment law rights and has been dubbed by the government as “the biggest package of workplace reforms for over 20 years”!

The Plan comes as a response to the Taylor Review of Modern Working Practices (the “Taylor Review”) which was published on 11 July 2017. This included a long list of recommendations to improve working life and employment rights. It focused on those seen as vulnerable workers such as agency workers, casual workers and zero-hours workers in the growing “gig economy”.

While any improvements to employment rights may be considered beneficial, some have criticised the limited impact of the Plan. For example, some people are not happy that the Plan fails to ban zero-hours contracts and fails to explain how its proposals will be achieved in places. For further information about what the Plan does cover, read on!

The Good Work Plan

The Plan is broken down into three main themes: fair and decent work; clarity for employers and workers; and fairer enforcement. Key changes include:

  • A right to request a more stable and predictable contract for workers;
  • Making it easier for casual staff to establish continuity of employment by changing the rules so that a break of up to 4 weeks (currently it is 1 week) between contracts will not interrupt continuity;
  • Abolishing the Swedish Derogation which allows recruitment businesses to pay agency workers less than their client’s comparable workers in certain circumstances;
  • Banning employer deductions from staff tips;
  • Researching and refining the employment status tests;
  • Providing written statements of terms for all workers from day one (rather than within 2 months) and “key facts” statements for agency workers;
  • Ensuring that the reference period for holiday pay is 52 weeks rather than 12 weeks for all workers, including seasonal and other atypical workers;
  • Cracking down on enforcement measures by naming employers who fail to pay tribunal awards; and
  • Quadrupling the maximum employment tribunal fines for employers who are demonstrated to have shown malice, spite or gross oversight from £5,000 to £20,000.

Following the release of the Plan, the government has also released draft legislation. The changes will be introduced in April 2019 and April 2020 if the draft legislation is approved by the Houses of Parliament.

Will the Good Plan Work?

Greg Clark, Business Secretary, claims that the Plan is the “largest upgrade in workers’ rights in over a generation”. Others, however, have been more sceptical. Francis O’Grady, General Secretary of the Trade Union Congress, may have welcomed the repeal of the Swedish Derogation but she has warned that the “reforms as a whole won’t shift the balance of power in the gig economy. Unless unions get the right to organise and bargain for workers in places like Uber and Amazon, too many working people will continue to be treated like disposable labour”.

Whilst benefitting workers, the changes will no doubt raise a number of concerns for recruiters and employers. For example, the removal of the Swedish Derogation is likely to lead to many employers having to re-visit client terms and pay rates which will require careful consideration. Other legal issues raised as a result of the Plan include changes to worker’s terms and conditions and employment processes.

If advice is needed on dealing with the proposed changes, please contact Paul Chamberlain and / or Emma James at Brabners who can be contacted on paul.chamberlain@brabners.com and emma.james@brabners.com respectively.

 

This bulletin is for general guidance purposes only and should not be used for any other purpose. Brabners is a Limited Liability Partnership.

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