This ongoing shift in the job market, as well as discrepancies around workers’ rights, has highlighted the need for employers and recruiters to understand the importance of a person’s employment status in relation to the legal rights they are entitled to.
The Advisory, Conciliation and Arbitration Service (ACAS) has updated its Employment Status guidelines to help employers understand the different ways people are able to work and their rights.
The guide outlines the three main categories of employment: employee, worker and self-employed. Stewart Gee, head of guidance at ACAS, has explained the increased focus on gig economy working over the past few years means that companies and their employees may not be aware that a person’s employment rights depend on their status. For instance, a person classed as self-employed will have different, and most likely fewer, rights than someone classed as a worker or employee.
The updated guidelines state that someone classified as a worker could include casual and agency workers, freelance and seasonal workers and those on zero hours contracts. If classified as a worker, a person is entitled to various employment rights including National minimum wage and holiday pay. In contrast, the self-employed category is for those in charge of the success and direction of their own business, and they are not entitled to holiday pay. The guide also explains how the relationship between someone working through an agency or an umbrella company functions.
Human resources teams across the country need to ensure they are classifying new employees correctly, particularly as ACAS’ updated guide arrives on the heels of recent court judgements concerning Uber and CitySprint, which found in favour of the workers who proved they had been incorrectly classified, as well as a horde of employment status cases and the continuing Taylor review of the modern workplace.
ACAS is not the only organisation providing clarity on employment rights. In early February, Matthew Taylor, an ex-policy advisor to Tony Blair, began a nationwide review to examine the influence that flexible employment contracts have on employers and employees. In mid February, the Work and Pensions Committee interviewed Uber, Deliveroo, Hermes and Amazon for their insights into the booming self-employment trend. Mr Taylor’s full review will be published later on this year.
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