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Labour may have ‘permanently postponed’ plans to reform gig economy, think tank says
(left-right) Prime Minister Keir Starmer hosts his first Cabinet meeting with Deputy Prime Minister Angela Rayner, Chancellor of the Duchy of Lancaster Pat McFadden, Education Secretary Bridget Phillipson and Defence Secretary John Healey at 10 Downing Street, London, following the landslide General Election victory for the Labour Party, July 6, 2024

SIGNIFICANT omissions in Labour’s New Deal For Working People suggest that the government has “permanently postponed” plans to help gig-economy workers, a leading think tank has warned.

The Autonomy Institute said the party’s decision to drop a commitment to introduce a single “worker” status during the current parliament “could mean that the pledge has been kicked into the long grass or, worse, permanently postponed.”

Gig-economy workers are widely considered to be in bogus self-employment, as to all intents and purposes they serve as employees, although contracting companies refer to them as self-employed to avoid the cost of National Insurance contributions and rights such as paid holidays.

Creating a single worker status would end this practice and ensure that such people are brought within the scope of further proposed reforms in such areas as raising the legal minimum wage to a real living wage and sick pay.

In a paper published earlier this year, Labour described the treatment of gig-economy workers as one of today’s great economic “scourges.”

Noting that they are Britain’s most insecure and poorly paid workers, the Autonomy Institute urged the party to retain its initial proposal to consolidate the various employment categories into a single status as a “key pillar of reform.”

The think tank added: “Of all the proposals made in the New Deal For Working People, this is perhaps the most ambitious and challenging to implement, entailing significant reforms to employment law and potentially additional reforms to the tax system and National Insurance contributions,” it added.

“Anything less could mean that the pledge remains in limbo, providing future governments with a pretext to roll back any progress made toward its full implementation.”

Doubts were also expressed about Labour’s commitment to outlawing zero-hour contracts after it emerged the party had downgraded a this pledge to cover only “exploitative” elements of the contracts.

The institute said this raised “questions about the integrity of the proposal,” adding that “other significant omissions include a proper plan for how to expand collective bargaining.”

Director of research Will Stronge said: “Ambiguities in some of Labour’s proposals to improve workers’ rights leave uncertainty over the scope or effectiveness of the programme as a whole.”

The Department for Business and Trade said: “Our imminent employment rights Bill will also deliver the biggest upgrade to rights at work for a generation and is a vital step in the delivery of the Make Work Pay plan.”

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