Zero-hours laws can boost “false self employment”

A new law on zero-hours work could force companies to promote ‘false employment’ and engulf agency workers, according to a committee of parliament.

Neil Carberry, chief executive of the Recruitment and Employment Confederation, told the House of Commons Business and Trade Committee that agency workers were exempted from many of the new laws covering zero-hours employees because agency workers have a “fundamentally a different, two-sided and flexible model of engagement”.

The committee held the final session of its inquiry into Make Work Pay earlier this week. Carberry was not the only senior executive that Carberry heard from. Senior executives at Deliveroo and other companies like Frasers Group, Evri, Uniqlo and Deliveroo were also questioned over unfair practices. They will be recommending changes to the Bill to Parliament in a few weeks.

Carberry stated: “It seems like there’s a real danger that, in order to avoid evasion from direct employers, bringing in one million temps [will] be driving some of the behavior we have reported in the last months, where some direct employer are using platform websites to engage people, who are clearly workers, as self-employed. False self-employment is the real enemy. That is our main concern with the Bill.

Carberry stated that umbrella companies need to be more regulated as they are the source of unethical practice. The Employment Rights Bill does not address this. Carberry said that the clients of agencies should also be responsible for compensating for cancellations.

Whistleblowers revealed to the MPs that poor practices were being applied towards zero-hours employees.

According to anonymous sources, delivery firm Evri had misled Parliament over inconsistent pay rates, “moving goalposts”, was “renowned for its computer system that never gets the wages right and robs couriers of thousands of pounds every month without a phone system to correct things”,

Hugo Martin said that he didn’t recognise the evidence, and that the pay rates he had in place ensured that couriers received more than the minimum wage, and were retained by the company for long periods.

Paul Bedford, Deliveroo’s director of group policy, stressed that the Supreme Court found that workers at his company were truly self-employed. However, he was concerned about the fact that Deliveroo continues to allow riders to subcontract their jobs to others who may not be legally allowed to work in the UK.

Bedford described how substitutions are common in many industries where self-employed individuals work. Deliveroo has implemented systems of registration and recognition to improve the practice in this field, he explained.

Bedford said that since we implemented the substitute registration, we’ve had about 6,000 accounts created. “That’s about 5% of our total riders.” This is the total number of substitutes. “We have prevented around 2,500 accounts to be finalised.”

Paddy Lillis, General Secretary of the Union of Shop, Distributive and Allied Workers, (Usdaw), said he welcomed “the Bill in its entirety.” It will be a game changer for millions of UK workers.

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