THE TAYLOR REVIEW AND ITS FALLOUT – WHAT ARE THE IMPLICATIONS FOR THE FLEXIBLE ECONOMY?
31st October 2017 – SME4Labour held a fascinating forum in Westminster on the Taylor Review into modern employment practices. Commissioned and endorsed by the Prime Minister, in July Matthew Taylor published his far-ranging review into modern work. Covering everything from zero-hours contracts to reforming employment law, the report has provoked significant debate. The event was kindly hosted by Bill Esterson MP (Sefton Central) and chaired by Philip Ross of Labour Business. Speaking at the event were Jack Dromey, MP for Birmingham Erdington; Simon McVicker, Director of Policy and External Affairs at the Association of Independent Professionals and the Self-Employed (IPSE); Hannah Reed, Senior Employment Rights Officer at the Trade Union Congress (TUC); and Mark Glover, founder and chief executive of communications consultancy firm Newington. Review author Matthew Taylor of the Royal Society for the Encouragement of Arts, Manufactures and Commerce (RSA) joined us in the second half of the session to discuss his report and to address some of the criticisms that have been levelled against it.
Chair Philip Ross asked how should Labour respond to the changing workplace landscape, highlighting the positive use of ‘workertech’ in the Taylor Review and its potential to assist in organising the self-employed. He suggested we look at initiatives in the United States and the Freelance Isn’t Free Act as a way to boost conditions for freelance workers and ‘giggers’. Mr. Ross promoted the idea of a Business Liaison officer – or ‘BuLO’ – in every constituency Labour Party to assist party activists in their local outreach efforts. Host Bill Esterson MP briefly spoke about his background in small business and said that Taylor was asking the right questions, even if not everyone agreed with all of his solutions. Before having to leave for a meeting, Mr. Esterson said that self-employment should be a “route to prosperity” rather than something that is frowned upon.
MP and veteran trade unionist Jack Dromey thanked SME4Labour co-chair Ibrahim Dogus for organising the event and for raising small business issues within the Labour movement, as well as previous speaker Bill Esterson for all of his hard work as Shadow Minister for Business. Mr. Dromey said that the Labour Party is pro-worker and pro-employer and that there is “no contradiction” in that. He stated that small and medium-sized enterprises (SMEs) are the “backbone” of the economy and that Labour’s plans in its general election manifesto – scrapping quarterly reporting for SMEs, a national investment bank with regional arms and so on – would be “transformative” and would greatly strengthen that backbone. He recommended Chi Onwurah MP’s recent article in the Guardian on automation in which Labour’s Shadow Minister for Industrial Strategy argues that it isn’t about being for or against automation, but rather about how we make automation work for the many, not the few. Dromey welcomed elements of the Taylor Review, saying that Taylor was right to raise the need for “flexi-security”, combining labour market flexibility with security for workers and a strong welfare state, and that it has kick-started a much-needed discussion about work. However, he felt that on a number of issues Taylor doesn’t go far enough – for example on zero-hour contracts, which Labour would abolish entirely (following New Zealand's example). Dromey had particularly harsh words for Uber in its treatment of drivers.
Simon McVicker of IPSE was up next. As with Mr. Dromey, Mr. McVicker welcomed the Taylor review in highlighting much neglected issues around precarious employment but said that some issues remained undealt with. He highlighted how self-employment is now around 4.8m and that the self-employed contribute £250bn to the economy annually. McVicker disputed some of what Dromey said about Uber, saying it is “not all bad”, but conceding the need for careful reform and regulation. He spoke about IPSE’s work with the Community union on the vulnerable self-employed. McVicker argued that there is a need for a statutory definition of self-employment in order to prevent exploitation. He said there is further work to be done on issues concerning pensions and paternity rights for the self-employed.
TUC employment rights officer Hannah Reed began her speech by stating that trade unions value and recognise the contribution made by SMEs and the self-employed. Ms Reed said that TUC analysis shows that insecurity in the workplace is primarily driven not by technological changes, as if often claimed, but rather by political decisions that hit the poorest and most vulnerable hardest. She spoke about how workers who are pushed into insecure work with diminished rights often find it difficult to plan their family lives. Reed agreed with Dromey that Taylor has made a “timely” and much needed contribution to the discussion about workers’ rights and ‘good work’, but that in some areas the review lacked ambition. Reed said that unscrupulous employers reap the financial rewards of growing insecurity while reputable businesses suffer. She said that flexibility in itself isn’t a bad thing and that it cuts both ways – however, currently it favours the employer over the employee, with a need for a “better balance”. Agency workers, for example, should receive sick pay, and workers need guarantees of proper remuneration. She criticised Taylor for muddying the legal waters around rights at work (‘dependent contractors’) and that stronger proposals were needed to ensure that flexible work provides regular, stable income. She criticised Theresa May for dropping the proposal to put workers on boards and that pressure now needs to be put on the government so that the positives from Taylor are implemented. She closed by saying that SMEs, the self-employed and trade unions are all workers and allies, and that they need to work more closely together in partnership.
Event sponsor Mark Glover spoke briefly before Matthew Taylor’s keynote speech to thank Ibrahim Dogus for organising the event and for his work with the British Takeaway Campaign (BTC). Mr. Glover outlined his company Newington’s work with taxi drivers in their struggle against Uber. Echoing Reed, he said that companies like Uber were less about technological developments and more about old fashioned exploitation and bosses cutting corners. Glover said that the UK can learn a lot from working practices and different models abroad. He posited that while SME owners aren’t always natural Labour supporters, they should be because Labour has the right policies for them – now Labour needs to go out and convince them of the party’s offer. He stated that “flexibility is used as an excuse for poor pay”, and highlighted issues such as tax and social profits.
Matthew Taylor, the author of ‘Good Work: The Taylor Review of Modern Working Practices’, gave the closing speech of the evening. He first spoke about the positives of the UK economy – low employment, positive perceptions among a majority of workers around flexibility, and rising incomes among poorer people. He then outlined his methods in undertaking the review, saying he avoided a “scattergun” approach. He said that the RSA always strives to think systemically but act incrementally and experimentally – or, as he put it, to “think like a system, act like an entrepreneur”. Mr. Taylor said that he aimed to “nudge rather than shove” – so, for example, the review recommends a higher minimum wage for non-contracted hours (a “nudge”) rather than abolishing zero-hour contracts altogether (which would constitute a “shove”). This, he said, would stop bosses shifting risk on to vulnerable workers while maintaining flexibility and dynamism in the economy. He argued for the right to request a permanent or fixed contract and transparency around the labour supply chain. Taylor noted that certain industries are particularly troublesome, providing the example of road haulage companies where workers are vulnerable and exploited with bogus self-employment. Taylor said that he wanted the UK to move towards a continental industrial relations model, where trade unions are seen as partners, and towards a new model of ‘active citizenship’, where democracy is extended to the workplace – a genuine taking back of control.
In the Q & A session, we heard questions relating to sick pay, SMEs and commissioning, universal credit, women and the gig economy, rip-off employers and business transparency. There was a discussion around how universal credit may curb or even reverse the growth of self-employment, the quality of management, stress and productivity, the need for trade unions to adapt to a changing workplace landscape, and how local procurement initiatives in Preston could be rolled out elsewhere to boost SMEs and provide inclusive growth.
Matthew Taylor has been Chief Executive of the RSA (Royal Society of Arts) since November 2006. During this time the Society has substantially increased its output of research and innovation, has provided new routes to support charitable initiatives of its 28,000 Fellows – including crowd funding - and has developed a global profile as a platform for ideas. In October 2016 Matthew was appointed by the Prime Minister to lead an independent review into modern employment; the review’s findings were published in July 2017.
Prior to this appointment, Matthew was Chief Adviser on Political Strategy to the Prime Minister. Previous roles include Labour Party Director of Policy and Deputy General Secretary and Chief Executive of the IPPR, the UK’s leading left of centre think tank.
Matthew is a regular media performer having appeared several times on the Today Programme, The Daily Politics and Newsnight. He had written and presented several Radio Four documentaries and is a panellist on the programme Moral Maze. He writes a regular column for the Local Government Chronicle. He has posted over a thousand times on his RSA blog site and tweets as @RSAMatthew.
Jack Dromey MP
Jack Dromey rose to prominence during the Grunwick strike in the 1970s. He went on to become the Deputy General Secretary of the Transport & General Workers Union and then the Deputy General Secretary of Unite. After being elected as Member of Parliament for Birmingham Erdington in 2010, he was appointed Shadow Housing Minister. He was instrumental in shaping Labour’s policy to build 200,000 homes a year.
In 2013, Jack was made Shadow Policing Minister. Prior to the election Jack undertook a Policing tour, visiting over 50 towns and cities across the UK and formulating Labour’s Policing Pledge. At the recent General Election Jack was returned as the Member of Parliament for Birmingham Erdington with an increased majority of over 7,500 and is now the Shadow Minister for Labour. In Parliament, Jack has been a champion of Erdington and Birmingham, campaigning for a fair deal for the City and for the West Midlands Police Service.
Bill Esterson MP
Bill Esterson is the MP for Sefton Central, first elected in 2010. He has served on the following Select Committees - Environment, Food and Rural Affairs, Education, Community and Local Government, Treasury. He was appointed Shadow Minister for Small Business in September 2015. He holds a joint degree in Mathematics and Philosophy from the University of Leeds. He trained with a large accountancy firm and subsequently became director of a training consultancy.
Hannah Reed is Senior Employment Rights Officer in the Economic and Social Affairs Department at the TUC where she works on policy and campaigns on collective and individual rights. Recent policy areas have included insecure work and co-ordinating TUC submissions to the Taylor Review of Employment Practices and the BEIS Committee Inquiry into the Future of Work. Other work areas include the implications of Brexit for employment rights.
Philip was one of the founding members of the IPSE in 1999 and served on its first board as External Affairs Director. He undertook the role of lobbying government and helping to deal with the media. Later, on IPSE's behalf, he joined the Home Office’s skills panel and helped to successfully persuade them to effectively close down their damaging fast-track visa scheme.
After a break of some ten years, in 2016 he returned as a freelancer and rejoined IPSE and was elected again to the Consultative Council. Outside of IPSE, he is a well known activist and campaigner on self employment. He has written many articles for sites as diverse as ContractorUK, Shout99, LabourList, Progress and Compass. He is a member of the CRSE think tank. Also, this year contributed to work done by the Social Market Foundation. He co-authored the influential report 'Not Alone - trade union and co-operatives solutions for the self employed' for Co-operatives (UK). He also co-authored the report 'Freelancing Agenda' for the Labour Party's business group.
As a result of his campaigning and policy work, he has strong national and international links with unions, co-ops and networks of the self employed and groups in the UK and groups like the Freelancers' Union in the USA. He works for his own limited company - the Great Digital Company - selling his services as a freelance agile business analyst in financial services and media. He specialises in digital transformation projects.
Simon is the Director of Policy at the The Association of Independent Professionals and the Self-Employed (IPSE). Simon has led IPSE's Department of Policy and Public Affairs for four years, during which time he has strengthened the organisation's links with politicians and other key influencers. He has more than 25 years' experience in the field.
Mark founded Newington Communications in 2006, and has overseen its growth into the dynamic and award winning consultancy that it is today. He splits his time between Newington’s London and Edinburgh offices – offering strategic counsel to board directors across a range of sectors at a local, devolved and national government level. He is the former chairman of the Association of Professional Political Consultants (2016-17).
Mark has been actively involved in politics since 1985 – as a councillor for twelve years, which included serving as the Chair of the Labour Group in Southwark, London. A regular public speaker, Mark also sits on the Ethical Advisory Board of the Marston Group, was a Founding Director of the Reformer magazine, supports charity UK Youth and is a regular industry awards judge.