Consultation outcome

Employment status

This was published under the 2016 to 2019 May Conservative government
This consultation has concluded

Read the full outcome

Detail of outcome

We have published employment status guidance for employment rights, alongside the government response to this consultation.

This guidance will make it easier for individuals to work out their own status while ensuring that the employment status system remains flexible and continues to adapt to modern working practices.

The government recognises that the employment status framework for rights works for the majority, but that boundaries between the different statuses can be unclear for some individuals and employers. However, the benefits of creating a new framework for employment status are currently outweighed by the potential disruption associated with legislative reform. Although such reform could help bring clarity in the long term, it might create cost and uncertainty for businesses in the short term, at a time where they are focusing on recovering from the pandemic.

Detail of feedback received

This consultation sought views on the current employment status framework, focusing on its complexity, the fact that it was open to interpretation, and the difficulty to resolve disputes and alignment between the frameworks for tax and rights.

We received 162 responses to this consultation:

  • the majority were from business representative organisations / trade bodies (20%) and trade unions (15%)
  • the remainder were businesses, individuals, accountancy firms, legal representatives, charities / social enterprises and local government / public sector

A large number of respondents were supportive of employment status reform but there was no overall consensus on what action the government should take. Respondents agreed that there was no easy solution, and it would be complex to implement any reform around employment status.

The majority of respondents also felt that the worker category remained helpful and should be retained, with some citing the flexibility it allows individuals and businesses in an evolving labour market. Overall support for the retention of the worker status came from almost all stakeholder groups.

Many respondents were in favour of introducing improved guidance on the employment status boundaries and examples on how to apply the rules to different scenarios.


Original consultation

Summary

We're seeking views on how to make the employment status rules for employment rights and tax clearer for individuals and businesses.

This consultation ran from
to

Consultation description

We’re seeking views on whether the options proposed in the Taylor Review of Modern Work Practices could achieve more certainty and clarity for businesses when determining employment status, particularly in relation to the realities of the modern labour market.

We are also seeking to understand the potential impacts and implications of those proposals. In addition, this consultation considers whether there are alternative approaches that could better achieve these aims. For tax, this consultation considers the tests that define the boundary between those currently taxed as employees and those who are taxed on a self-employed basis.

Further detail

On 7 February 2018 we published the government response to the Matthew Taylor Review of Modern Working Practices along with this and 3 other related consultations:

Documents

Employment status consultation

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Updates to this page

Published 7 February 2018
Last updated 26 July 2022 + show all updates
  1. Government response published, along with new guidance on employment status and employment rights.

  2. First published.

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