Industry rounds on government for no Employment Bill

Voices across the recruitment, employment, umbrella and compliance landscape have almost unanimously rounded on the government for failing to deliver an Employment Bill within the Queen’s Speech yesterday [10 May 2022].

However, some suggest that the results of currently pending consultations may actually shape aspects of the Employment Bill, first mentioned by government in 2019.

Pointing out that the Bill could have provided greater protection for contingency workers, Chris Bryce, CEO of the Freelancer and Contractor Services Association (FCSA) said: “It’s a missed opportunity from the government that they didn’t heed the industry’s call to introduce much-needed regulation for the umbrella sector.

“We absolutely support the introduction of effective regulation in the professional employment services sector, as we believe it will further strengthen standards in the industry, ensuring businesses comply with the spirit and letter of the law and thus better protect workers.
“We believe many aspects of employment law need to be urgently addressed – so, despite the disappointing news, it’s a goal we’ll continue to work towards in the absence of wider regulation.

“We are determined to continue to engage with relevant authorities – including BEIS and HMRC – to help shape regulation that will be effective in achieving its intended aims and that will protect the sector as a whole, including contractors and service providers.”

Others commenting today [11 May] were:

Crawford Temple, CEO of Professional Passport, assessor of payment intermediary compliance: “It was not entirely surprising that there was no mention of the Single Enforcement Body in yesterday’s Queen’s Speech. 

“We are currently waiting to hear the findings from the government’s Call for Evidence into the umbrella industry and Margaret Beels, director of Labour Market Enforcement has also initiated a consultation that closes on 31 May calling for evidence on emerging issues around compliance and enforcement in the UK labour market, which will help inform her labour market enforcement strategy for 2023/24. I anticipate that the findings from both those reports will then serve to inform the priorities of the Single Enforcement Body.”
Dave Chaplin, CEO of compliance firm IR35 Shield said the continued delay of the Employment Bill still “does not prevent the authorities from cracking down on tax avoidance and evasion that enters the supply chain via agencies working with disreputable umbrella companies. HM Revenue & Customs (HMRC) already garners the data it needs, and just needs to act on it quickly.
“Unfortunately, despite many experts providing compelling evidence to HMRC when they see wrong-doing, actions by HMRC are slow, which ends up with HMRC chasing the victims for the money, and not the scheme providers.”

James Poyser, CEO of inniAccounts and founder of “The Single Enforcement Body (SEB) was due to be announced in the Queen’s Speech today in the Employment Bill, but it was notable by its absence. It’s unfathomable as to why this government has not prioritised the creation of the SEB, and the regulation of the umbrella company industry as well as other repugnant practices related to employment rights such as slavery. It delivers a brutal message of indifference to hard working, self-starters from gig economy workers to consultant GPs and private sector contractors.

“The off-payroll reforms have made the employment supply chain brittle and unfit for purpose at a time when businesses are desperate for less red tape and flexible skill to recover and grow. This has resulted in thousands of workers being forced into the vulnerable situation of being exploited by unscrupulous umbrella companies.”

Rebecca Seeley Harris, chair of the Employment Status Forum: “The loopholes in the law, which allow this exploitation, desperately need to be closed and the creation of the SEB would have been a good step towards this.

“We will continue to work with BEIS and the director of Labour Market Enforcement to ensure that these vulnerable umbrella company workers get the protection they deserve. As well as ensure that reputable umbrella companies are not disadvantaged by the lack of regulation of the industry as a whole.

“Even without an employment bill, it is hoped that the government will still look to close the loopholes such as the abuse of the ‘use it or lose it’ holiday pay scams, where the law is woefully behind current employment practices. They need to bring forward legislation as a result of the judgment in the Pimlico Plumbers case in the Supreme Court last year, and we will continue to call for action.”

Sophie Vanhegan, partner at law firm GQ|Littler, says that companies are increasingly moving forward with enhancing their own flexible working policies above the current legislative framework in order to attract and retain key talent in a highly competitive job market.

“Yet another delay to the Employment Bill inevitably leads to continued uncertainty for employers, who have been unable to determine whether their policies and practices need to be updated in readiness for the proposed changes.

“A lot of large corporates have already gone ahead and put similar measures of their own in place. In the absence of legislation, the current tight labour market is generating change in and of itself. Employers competing for talent are leading the way in the absence of these changes coming through changes to the law.

“However, many employers we speak to would welcome a level playing field on these issues and would welcome the government taking the lead on employment rights.”

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