TRADE UNION DESK: What is a worker?
The economic ambition to create more ‘good jobs’ requires a statutory presumption that all individuals will qualify as ‘worker’ under the new definition of a ‘worker’, writes the ICTU’s John O’Farrell.
In the days before Labour’s first Budget, there was an unusual focus in the Tory press on membership of the working class, far from the way in which working people are traditionally portrayed in those UK newspapers, as skivers and strikers.
First in the queue for the status of lucky proletarians were, naturally, landlords whining to the Daily Mail: “Landlords in Britain labelled Sir Keir Stamer ‘insulting’ and ‘out of touch’ today after he suggested they do not count as ‘working people’ ahead of the Budget.”
The comments on MailOnline were instructive: ‘I’m a landlord, and work five days a week on minimum wage in a school. What am I?’
Answer: You are a badly paid education worker and you also have a side gig as a landlord.
Like many since 2010, landlords have benefited from the focus on ‘rentiers’ at the expense of workers. The former include people who earn income from capital without working, generally done through ownership of assets that generate yield (cash generated by assets), such as rental properties, shares in dividend paying companies, or bonds that pay interest.
A ‘worker’ by contrast, is defined by the UK Government as having a contract or other arrangement to do work or services personally for a for money or a benefit in kind, for example, the promise of a contract or future work. They make things or provide a service and get paid for that. In additional contrast, they tend to pay a higher proportion of taxes and national insurance than landlords or shareholders.
We also have a clear breakdown of who is classified as a ‘worker’ by the Annual Survey of Hours and Earnings, which is the most detailed source of information on earnings levels, distribution of earnings, make-up of earnings, and paid hours worked. It tells us the occupations which are most remunerated (corporate managers, directors, education professionals and business/media/public service professionals are the top three groups) and also the highest paid sectors (electricity/energy supply, telecommunications, and education).
All workers should benefit from the same employment rights, including protection from unfair dismissal, by creating a single ‘worker’ status for all but the genuinely self-employed.
John O’Farrell
At the other end of the earnings spectrum, many workers still earn below the real living wage, especially in sectors like accommodation and food services. According to the Nevin Economic Research Institute: “This highlights a disconnect between wage growth and the rising costs of living, particularly for essentials like housing and food. Vulnerable groups, such as part-time workers, young people, and women, continue to face high rates of low pay, indicating a need for targeted interventions. The data also reveal a decoupling between the proportion below the real living wage and the proportion below the median and emphasises the importance of considering changes in the costs of essential goods and services.”
Who are we talking about? The percentages of workers by occupation who are paid below the real living wage tell their own story: sales and customer Service (60 per cent); elementary occupations (55 per cent); arts and entertainment (43 per cent); administration and secretarial (25 per cent); caring and leisure (30 per cent).
The forthcoming NI Employment Act can also clarify the definition of who is a worker. The labour market in recent years has been marked not only by low pay, but the precarious status of thousands of working people due to a one-sided ‘flexibility’, which allows some egregious behaviour by too many employers. In our submission to the Department for the Economy on the ‘good jobs’ bill, we addressed the anomaly in our employment law which recognises three types of employment status: ‘employees’, ‘self-employed contractors’, and ‘workers’.
All workers should benefit from the same employment rights, including protection from unfair dismissal, by creating a single ‘worker’ status for all but the genuinely self-employed. Create a statutory presumption that all individuals will qualify as ‘worker’ under the new definition.
These workers deserve ‘day one’ employment rights. We must remove the arbitrary and unfair qualifying time periods that restrict access to employment rights, particularly for insecure workers. That those in self-employment, whilst not qualifying for full employment protection, should still benefit from an improved safety-net of work-related benefits, including statutory maternity, paternity and adoption pay, statutory sick pay, and auto-enrolment into pensions.
In order to see improvements for workers, it is useful to be clear of whom we are talking about.
