National minimum wage and self-employment
Since the revelation that “49% of self-employed workers (4.8 million people) earned less than £310 a week”, the Resolution Foundation have published its opinion that the minimum wage should apply to the self-employed.
The Resolution Foundation says:
“The UK’s labour market has been very successful at creating jobs in recent years. However, far too many of those jobs offer very low pay and precious little security….This is especially true of the growing army of the self-employed. While many are higher earners who benefit from significant flexibility, around half fall below the low pay earnings threshold of just £310 a week
“The government can start by extending minimum wage protections to those self-employed people whose prices are set by a firm. This would mean that self-employed people in the gig economy would be given protection against extreme low pay for the first time ever”.
Because this can stop employers from making individuals purposely self-employed just to avoid the need to pay them the minimum wage. Therefore if the minimum wage does apply to self-employed individuals, this will likely reduce exploitation in the UK workforce generally. Additionally, some may say that if the basic premise of the minimum wage is to ensure all individuals earn enough to live, then this protection should apply no matter whether such individuals are employees or is self-employed.
It will be interesting to see whether this recommendation comes to fruition. If it does then it may open the door for other rights, such as the compulsory 20 minute break (for a working day that is six hours or longer) and a 48 hour maximum working week, rights currently enjoyed by employees. Additionally, if these recommendations become implemented, this may be a step towards the UK having a single stand-alone category of worker, rather than the three types (‘employee’, ‘worker’ and ‘self-employed’) that we have today.
By Zahid Reza, Paralegal
Image courtesy of Resolution Foundation