From the TUC

The Budget and false self-employment

06 May 2009, by in Labour market, Working Life

The problem of false self-employment can sound technical. But for those affected it can be catastrophic. Workers who are falsely classified as self-employed can be denied access to the most basic of employment rights, including the minimum wage, holiday leave and pay and sick pay. In addition, nominally self-employed staff are far less likely to be provided with training or to benefit from union representation, leading to poorer health and safety. The problem is particularly prevalent in the construction sector where it is complicated by the Construction Industry Scheme (CIS), which has been shown to provide employers with tax incentives to classify dependent workers as self-employed.

So it is a positive step that page 112 of the Budget turns out to have committed the Government to consult on future legislation to ensure that construction workers, and those who employ them, are taxed appropriately. If this works, it could mean that while genuinely self-employed contractors will continue to operate in the sector, dependent workers will have a better chance of fair treatment at work.

This could easily all come to nothing – the timetable for the consultation is not yet clear, and no further details as to its content have been made available. But reaction from the industry does suggest that The Treasury have started to take the problem seriously: Contract Journal reports that contractors believe HMRC may “slash the number of workers classified as self-employed”. For many construction workers, as UCATT has long pointed out, this could mean that real rights at work are now a slightly closer reality.