Employment Rights Bill

Lord Freyberg Excerpts

Report stage
Wednesday 23rd July 2025 Lords Chamber

[Lord Clement-Jones (LD)]

My Lords, it is extremely disappointing that we are debating something of this order of importance at this time of day and at the fag-end of this Bill. However, unusually, I shall try to ingratiate myself with the House by being as brief as possible.

First, I want to thank the noble Lord, Lord Katz, for his letter of 30 June and for the publication of the draft terms of reference for the freelance champion, referred to by the noble Earl, Lord Clancarty, who set out the stall extremely cogently for these amendments. I do not need to go over the ground that he has explained extremely well. The lack of a single clear voice representing the interests of freelancers to government is what this is all about—a clear definition of what a freelancer is and clear duties for the freelancer commissioner.

The freelance champion has some similar characteristics to the freelance commissioner, but there are significant differences from the independent freelance commissioner. It is not going to be a statutory office, unlike the freelance commissioner. The structure proposed in our amendments would be more permanent and more independent of government. The terms of reference explicitly state that the champion will focus on freelancers working in the creative industries only, so it will not be cross-sectoral. As we heard from the noble Lord, Lord Londesborough, it is clear that freelancers are extremely prevalent not only in the creative industries but in many other industries as well, including construction, professional, scientific and technical activities, business support, health and social work, IT, digital services and education and training.

While welcome, the freelance champion for the creative industries under the sectoral plan does not go nearly far enough across the board in making sure that there is a real advocate and one with teeth who is able to influence policy towards freelancers across all those different sectors. The question really is why the Government have failed to grasp the urgency and widespread nature of the challenges faced by freelancers across all sectors. It is not unclear that freelance work covers much broader areas than just the creative industries. These amendments would offer recognition to a workforce that contributes enormously to our economy and cultural life and is too often unprotected and unheard in legislative terms.

I urge the Government, even at this time of day and at this time in the Bill, when they cannot really change their approach, really to think about this. We have heard so much about how, on AI or dependent contractors, the Government are considering these things. They really need to shape up in terms of the modern economy. Freelancing is on the increase and they need protection—and the freelance commissioner would be by far the best way forward.

[Lord Freyberg (CB)]

My Lords, it is a pleasure to follow my noble friend Lord Clancarty and the noble Lord, Lord Clement-Jones, who have each set out the case for a more coherent and strategic approach to freelance policy with great clarity. I shall not repeat their arguments but will attempt to build on them.

I support Amendments 160 to 162, to which I have added my name, and I will speak to my own Amendments 163 to 165. I declare my interest as an artist member of DACS, the Design and Artists Copyright Society.

--- Later in debate ---

Moved by

[Lord Freyberg]

167: After Clause 150, insert the following new Clause—
“Report: freelancers, self-employed persons and sole traders(1) Within nine months of the day on which this Act is passed, the Secretary of State must publish a report setting out—(a) fixed definitions of the following categories of workers—(i) freelancers,(ii) self-employed persons, and(iii) sole traders,(b) an assessment of how the categories of worker in subsection (1)(a) may be impacted differently by the provisions of this Act, and(c) recommendations to ensure fair and equitable treatment of workers across the categories in subsection (1)(a).(2) The Secretary of State must lay the report under subsection (1) before Parliament.”Member’s explanatory statement
This probing amendment seeks to clarify how the Government defines freelancers, self-employed persons and sole traders, and to understand how this Bill may affect those categories of worker.

[Lord Freyberg (CB)]

My Lords, Amendment 167 is in my name and that of the noble Lord, Lord Londesborough, whose support I am extremely grateful for. I will also speak to Amendments 177 and 178. Many of my points are likely to coincide with those to be made by the noble Lord, Lord Moynihan of Chelsea, on his Amendment 184A. However, his amendment takes a much broader view of the employment landscape than I do. I look forward to hearing his speech, and that of the noble Lord, Lord Clement-Jones, who will revisit the definition of the independent contractor.

Amendment 167 is a probing amendment that draws attention to the lack of consistent and widely accepted definitions of “freelancers”, “self-employed persons” and “sole traders”. These terms are often used interchangeably but carry distinct legal and practical implications.

A helpful approach would be for the Government to adopt a three-tier taxonomy, defining “freelancer” as a person who provides services on a project or contract basis, often to multiple clients, without being an employee. Amendment 161 from the noble Lord, Lord Clement-Jones, serves as an effective model for this, notwithstanding the comments by the noble Lord, Lord Hendy. The annexe in the draft terms of reference for the freelance champion, which I have seen, like the noble Earl, has also attempted to define a freelancer, which is a useful first step but by no means definitive.

A self-employed person is someone who runs their own business and is responsible for its success or failure, typically registering with HMRC for tax purposes. According to July’s House of Commons UK Labour Market Statistics report, self-employed people make up approximately 13.5% of the labour market, which currently has 4.43 million self-employed individuals.

A sole trader is a specific legal and tax classification in which an individual runs a business in their own name without forming a limited company. Although all sole traders are self-employed, not all self-employed persons are sole traders, and some may operate through partnerships or limited companies. Freelancers may span both categories, depending on their business structure.

The amendment also asks for

“an assessment of how the categories … may be impacted differently by the provisions of this Act”.

This provides an opportunity to examine disparities in access to employment protections, financial services, taxation and eligibility for public support. For instance, while a sole trader may more easily access certain types of finance or insurance, freelancers working intermittently across sectors often face barriers in securing mortgages, pensions, sick pay and other forms of welfare.

A government report could use illustrative case studies to clarify the lived experience of these categories—for example, contrasting the experience of a freelance illustrator, a self-employed plumber and a sole trader café owner. To ensure fair and equitable treatment across these groups, the Government may wish to explore options for harmonising entitlements and protections where possible. This might include developing portable benefits for freelancers, expanding access to contributory social protections or encouraging the adoption of freelance codes of good practice. The Creative Industries Council’s freelance toolkit is one model that could be promoted across sectors.

Amendments 177 and 179 raise closely related concerns regarding the visibility and classification of workers in the visual arts and craft sectors. These sectors often involve individuals working across multiple roles, such as creators, educators, curators and consultants, and frequently combine freelance and part-time employment in complex ways. Employment and legal status in these fields is therefore especially difficult to define clearly, which can leave individuals underprotected or misrepresented in government data and support schemes.

The Government could respond by convening a time-limited working group with representatives from relevant sector bodies, such as the Artists Information Company, the Crafts Council, Heritage Crafts, CVAN, DACS, the Cultural Policy Unit and Creative UK, to develop practical guidance on employment classification in the arts and crafts sectors. This could be an initial task for the creative freelance champion to prioritise early in their role.

Both amendments also highlight the significant limitations in how current standard industrial classification, SIC, and standard occupational classification, SOC, codes capture creative labour. For example, SIC code 9003 for “artistic creation” groups together visual artists, authors, composers and digital designers, obscuring the distinct needs and contributions of each group. SOC codes similarly fail to disaggregate fine artists, applied artists and craftspeople.

I understand that government departments may use a threshold of approximately 4,000 practitioners as a cut-off point for counting people working in various sectors—if the Minister could clarify this, it would be most helpful—as this approach would exclude virtually all heritage craft makers from official statistics. The Red List of Endangered Crafts includes 285 crafts, but not all of them are covered by the current SIC and SOC codes.

--- Later in debate ---

[Lord Katz (Lab)]

My Lords, I wish I had also brought my white hanky to the debate, but sadly I do not have that cop-out. This been a short but focused and interesting debate. I will begin with Amendments 177 and 179, tabled by the noble Lord, Lord Freyberg. The Government are well aware of the importance of accurate occupational categorisation, especially for those in culturally important occupations, and the noble Lord and I have separately discussed this issue and the complexities around it.

More specifically, we understand that some stakeholders feel the four-digit standard occupational classification—SOC—system is not detailed enough for their needs. To address this, in 2023 the ONS published an extended six-digit system that includes more accurate categories for groups like those mentioned by the noble Lord in his amendments. In addition to this, the ONS is now beginning work on the next update to the SOC system, which will be published in 2030.

I am afraid that I do not have some of the details on disaggregation, the levels of qualifications and so on that the noble Lord, Lord Freyberg, asked about, but I will undertake to write to him with more details. However, I would be very happy to facilitate contact between the noble Lord and the ONS team that is responsible for this work. He has demonstrated great interest and no little expertise in this subject area, and I am sure that they would appreciate his views and detailed analysis on the system, how it could be improved and how it could better reflect the complex ecosystem of craftspeople and other creative workers.

I turn to Amendment 167, again tabled by the noble Lord, Lord Freyberg, and supported by the noble Lord, Lord Londesborough, as well as Amendments 183 and 184A, tabled by the noble Lords, Lord Clement-Jones and Lord Moynihan, respectively. I hope that the noble Lords are reassured from the debate on the previous group that the Government take the commitment to tackling pressing issues with the existing employment status framework very seriously—and from the comments of the noble Lord, Lord Clement-Jones, I think that is the case.

As the noble Lords, Lord Moynihan and Lord Clement-Jones, said, consultation in the fullest sense is imperative on this issue. It will allow us to receive and consider the widest range of views and engage fully with relevant stakeholders, including those mentioned by the noble Lord, Lord Moynihan, in his amendment. Consulting on employment status was a commitment in the plan to make work pay, and as my noble friend Lady Jones outlined to your Lordships’ House in the debate on the previous group, today we are confirming that we will publish a consultation on this by the end of the year. As the noble Lord, Lord Moynihan, said, we will risk undermining the value of this work if we introduce new definitions without prior consultation.

The noble Lord also mentioned requiring an impact assessment of any legislative proposals brought forward as a result of this consultation. I can reassure your Lordships’ House that, in keeping with our better regulation requirements, we will produce impact assessments alongside any such legislation.

I hope this assures noble Lords that the Government are committed to consulting on employment status and are doing so with the care, focus and full engagement that this important issue requires. On this basis, I ask the noble Lord, Lord Freyberg, to withdraw Amendment 167.

[Lord Freyberg (CB)]

My Lords, I am very grateful to all noble Lords who have contributed to this thoughtful and wide-ranging debate. In particular, I welcome the announcement of the employment status consultation, which will be very helpful in looking at this matter in the round. I also am very grateful to the Minister for his offer to put me in touch with the ONS; I would be delighted to accept that and take it up at a later point. Given the lateness of the hour, I will not comment further. I beg leave to withdraw my amendment.

Amendment 167 withdrawn.