Employee Relations

What is the UK government’s Good Work Plan?

happy employee

In July 2017, Matthew Taylor – Chief Executive of the Royal Society of Arts – conducted an independent review of modern working practices. In conclusion, the “Taylor Review” – as it has become known – set out a number of recommendations for the UK Government.

In 2018, the Department for Business, Energy and Industrial Strategy, published a paper in response to the Taylor Review. This paper was called the “Good Work Plan”, and set out the ways in which the UK government planned to address the concerns and implement the recommendations, made by Matthew Taylor.

The Good Work Plan sets out some fairly big changes and ideals that will impact UK employers. So I decided to write a short summary of the paper, to help you understand the general direction the UK Government is likely to take in terms of workplace legislation, both in the immediate future and in the next few years that follow.

The four recommendations the Good Work Plan hopes to tackle

The UK Government’s first response to the Taylor Review was to seek consultation on tackling four specific recommendations:

  1. Employment status
  2. Increasing transparency
  3. Agency workers
  4. Enforcement

In a nutshell, the Government is hoping that the Good Work Plan will address each of these four areas. It aims to narrow the gap between different employment statuses, make the job market fairer for agency workers, increase the transparency by which this all works, and then find better ways to enforce the new legislation.

The five principles the Good Work Plan hopes to follow

As well as the four areas the UK Government hopes to change for UK workers, their Good Work Plan also sets out five foundational principles of quality work:

1, Satisfaction

2, Fair pay

3, Participation and progression

4, Wellbeing, safety and security

5, Voice and autonomy

These are the principles the Good Work Plan hopes to follow when guiding legislative action from the Government. So let’s take a look at what the Government actually plans to change over the coming years, as a result of the Taylor Review.

I have read the Good Work Plan. And based on my understanding, there are eight prominent actions that the government plans to take:

1. Give ALL workers the right to a more stable contract

The Good Work Plan seems to recognise that the British culture of flexible working, is a model that works. However, it also suggests that this model of flexibility is too one-sided, in the sense that the worker shoulders too much business risk.

The main problem this causes is a lack of financial stability. So to combat this, the Good Work Plan pledges to implement legislation that will give all workers the “right to request a more stable contract”.

2. Remove the loophole from pay-between-assignment contracts

Pay between assignment contracts is a type of contract given to agency workers. And when used correctly, they can be very helpful!

These contracts mean that agency workers are entitled to be paid by their agency, in between assignments. In other words, when they are waiting for their next job, they still have an income.

However, the Taylor Review seemed to identify that some businesses are exploiting this type of contract, in order to circumnavigate equal pay arrangements between agency workers and their permanent workers.

As such, the Good Work Plan promises to ban the use of this type of contract, in this particular way.

3. Ban employers from taking tips given to employees

When you give a tip for good service, you expect it to go straight to the person who provided you with that good service, don’t you? I know I certainly do. Or, rather, did. But the Taylor Review uncovered a practice by which a small number of employers actually retain tips earnt by their staff.

This is awful for many reasons and goes against the very reason why tips tend to exist. And for this reason, I am very pleased to read that the Good Work Plan aims to legislate to employers from making deductions from staff tips.

4. Make employers provide a statement of rights to workers

Not enough workers understand the types of contracts they are entering into, which is how they often end up getting stung. Therefore, the Good Work Plan says that employers will need to be more clear about what the reality of any working contract is before work begins.

The way the Government plans to do this is to give workers the entitlement to a “statement of their rights” on appointment. And as this measure is specifically designed to help agency workers, the Government plans to set out the specific information that agencies must provide to agency workers, in order to help them make more informed choices about the kind of work they accept.

If you employ agency workers, then you might want to get a head start by ensuring you already understand the terms and contracts that you use.

5. Minimise the differences between different employment types

A lot of the Good Work Plan focuses on agency work, and the reason for this is that agency workers are often the ones who are most likely to be working in unfair conditions.

Part of the Good Work Plan aims to align the various types of employment types, to make them more similar. Not more similar in terms of style – but rather, to make sure all workers have similar rights and pay similar rates of tax.

In a nutshell, this means that gradually, over time, we will begin to see that workers are less likely to forfeit rights, or pay different rates of tax, simply because of the employment framework they are working within.

6. Improve the accuracy of employment status tests

Many workers are confused about their rights, and the Taylor Review makes that very clear. One reason for this is that the tests that the Government uses to classify employment status, are not good enough.

The Good Work Plan sets out legislation that will improve the clarity of employment status tests. The aim is to reflect the reality of modern working relationships – because tests right now do not do a good enough job of that.

Ultimately, the theory is that this will stop businesses from avoiding certain responsibilities, by trying to misclassify worker status.

7. Extend penalties to include underpayment of holiday entitlement

These next two points are related to how the Good Work Plan aims to improve the way employment laws are enforced. And the first key change that the Government is planning, is to extend the scope of existing enforcement. Let me explain.

Currently, there are tough financial penalties that apply to companies that fail to pay employees the National Minimum Wage.

The Good Work Plan aims to extend these existing penalties, to cover a wider scope. More specifically, they wish to extend these penalties to also include employers who take advantage of vulnerable workers, in the form of underpayment of holiday pay.

8. Increase the maximum penalty imposed by Employment Tribunals

Finally, as well as increasing the scope for which offences are punishable, the Good Work Plan details the Government’s intention to increase the size of penalties. By quite a significant margin, too!

The Good Work Plan aims to increase the maximum penalty imposed by Employment Tribunals, to £20,000.

Will the Good Work Plan continue, under a new UK Government?

The Good Work Plan was prepared by Greg Clark, during his time as Secretary of State for Business, Energy and Industrial Strategy. In July 2019, new Prime Minister Boris Johnson appointed Andrea Leadsom as Greg Clark’s replacement.

I can only hope and assume that Leadsom plans to continue with the groundwork laid out by Matthew Taylor and, subsequently, Greg Clark. It would make sense, considering the UK Government has enough on its plate with Brexit, to start unpicking existing roadmaps that seem to have a sensible basis for implementation.

We can already see some of the goals from the Good Work Plan taking effect. So I think we can expect to see a lot more coming to pass in the months and years just ahead of us.