The Good Work Plan

Employment Law Alert | January.07.2019

On 17 December 2018, the UK government released the “Good Work Plan,” which sets out its vision for the future of the UK labour market. This is the latest implementation of the Taylor Review and proposes legislative changes “to ensure that workers can access fair and decent work, that both employers and workers have the clarity they need to understand their employment relationships, and that the enforcement system is fair and fit for purpose”. In its press release, the government labeled it as “the biggest package of workplace reforms for over 20 years." Some of the key changes include:

General Employment Rights From April 2020

  • An extended right for all workers (not just employees) to be provided with a statement of rights on day one (rather than within two months) setting out key terms of their contract;
  • An increase in the period required to break continuity of employment from 1 week to 4 weeks, giving atypical workers better access to key rights;
  • A ban on employers making deductions from staff tips;
  • An extension of the holiday reference period for holiday pay from 12 to 52 weeks; and
  • Lowering the threshold for a request to set up information and consultation arrangements from 10% to 2% (retaining the 15-employee minimum).

    Protections For Agency Workers

  • The repeal of the Swedish derogation from April 2020, which allows employers to pay agency workers less than permanent workers if they have an employment contract with the agency that gives them the right to pay between assignments;
  • A new power to impose penalties on employers who breach employment agency legislation; and
  • Every agency worker to receive a “key facts” page, providing basic information about their contract, pay rates and pay arrangements.

    Gig Economy

  • Legislation to improve the clarity of the employment status tests, with proposals on how to align the employment and tax tests (which currently differ); and
  • A right for workers to request a more predictable and stable contract after 26 weeks’ service on a non-fixed pattern.

    Fairer Enforcement

  • Introducing a “name and shame” scheme for employers who fail to pay Employment Tribunal awards, similar to the scheme for national minimum wage underpayment;
  • An increase in the maximum penalty from £5,000 to £20,000 for “aggravated” breaches of employment rights with effect from 6 April 2020; and
  • A single labour market enforcement agency to ensure workers’ rights are properly enforced.

While the plan addresses all the Taylor Review recommendations, it is very short on detail as to how or when the most major reforms will be implemented and what much of the important legislative detail will look like. Perhaps most crucially, there is still little clarity around the gig economy and whether the worker status questions that are still trundling through the courts will be dealt with via legislation. Instead, the Plan states that detailed proposals will be published in due course. After taking 17 months to consider the Taylor Review, and undertaking four public consultations, it is likely that many will be sceptical as to whether what is being promised will actually happen. Whether or not the “biggest package of workplace reforms” will match the government’s rhetoric remains to be seen.