Employment Rights Bill

Lord Moynihan of Chelsea Excerpts

Report stage
Wednesday 23rd July 2025 Lords Chamber

[Lord Clement-Jones (LD)]

My Lords, I am going to be extremely brief because it is now 11.20 pm. We need to finish these proceedings at least before midnight, but that may be an ambition too far. I declare an interest, as I should have done in the last group, as chair of the Authors’ Licensing and Collecting Society.

It would have been extremely useful to have inserted the speeches of the noble Lords, Lord Hendy and Lord Berkeley, because that is precisely what my amendment is all about. It is about ensuring that our employment law ensures the rights of a growing segment of our workforce. Our current system is based on statutory definitions and case law, and it settled on three categories: self-employed; worker—also known as limb (b), as the noble Lord, Lord Hendy, mentioned —or dependent contractor; and employee. However, determining whether an individual falls within this framework is often inconsistent and reliant on lengthy and expensive court cases, such as the landmark Uber v Aslam case. The Minister has extremely helpfully undertaken a consultation on employment status, and that is exactly what this amendment was designed to provoke, so I feel that to a large extent we have succeeded in pushing the Government further towards defining that kind of employment status.

I have had some useful conversations with Evri, which engaged in a legal case when it was under the name Hermes. As a result of its engagement with the GMB, it has come forward with what I think is an extremely interesting and satisfactory form of dependent contractor status that grants certain rights as if they were employees, and that is precisely what I hope this consultation will come up with in terms of family leave, entitlements, the right to request fixed hours and so on. The GMB, while awaiting formal policy setting through its democratic process, has expressed a positive stance towards retaining and reforming the limb (b) worker status. So I hope that the consultation that the Government engage in will not try to force everything into two categories but will make sure that that third category is recognised and given enhanced rights.

I think there was some misunderstanding in Committee in what the Minister said. She talked about complications and so on, and I hope that does not mean that what we are all trying to get to is two categories, employment or self-employment. I hope that the result of the consultation will be to come forward with some kind of dependent contractor status for precisely the kinds of people that the noble Lord, Lord Berkeley, was talking about—however fast they may go on their scooters.

[Lord Moynihan of Chelsea (Con)]

My Lords, I rise to introduce at this late hour Amendment 184A in my name. I refer to my registered interests as an employer and investor. I thank the many noble Lords on the Labour Benches who have kindly stayed to hear the noble Lords, Lord Freyberg and Lord Clement-Jones, and myself; it is very decent of them. The noble Baroness, Lady Jones, kindly committed just now to publishing the Government’s consultation on employment status, which relates strongly to the amendments that the three of us have introduced to this clause, and it is very welcome to hear that commitment. For me, that takes us half way to what my amendment proposes.

The Minister’s focus just now was on freelancers, while that of the noble Lords, Lord Freyberg and Lord Clement-Jones, was on both freelancers and the self-employed. My amendment focuses on protecting the self-employed and the so-called middle worker status, in particular for so-called platforms, which I will elaborate on briefly in a minute. I do hope to get your Lordships out before midnight; I will do my best.

The Government’s make work pay document, part of their manifesto, has, as we all know, made various commitments—or threats, as we call them on this side of the House—relating to workers’ employment status. Some are included in the Bill and some are promised for an unspecified future Bill or other kind of regulation. In particular, the employment status of worker, a middle stage between self-employed and fully employed, as just described by the noble Lord, Lord Clement-Jones, and as decided in the ruling in the Uber case, is to be reviewed, and there is the threat that that category will be tightened or even abolished. To date, the Government have said little else about its future although, in the Bill we are discussing now, Clause 1 on guaranteed hours and Clause 2 on shift contracts both significantly constrain what an employer can agree with an individual holding worker status.

It is depressing to note how the Government’s financial and regulatory policies are already hitting employment—the very topic of this Bill—not just in traditional areas such as pubs and entertainment, but in those advanced sectors where the economy’s hope for the future lie: AI or gene modification, for example, and now, in this Bill, the platform businesses that drive the gig economy.

Take driver platforms. In surveys, 76% of drivers say being self-employed is the key attraction; 60% of them value flexible hours above all else, rising to 72% among working parents. Nearly nine in 10 use multiple platforms to earn a living, which would be near impossible if rigid employment frameworks were imposed. A strong entrepreneurial spirit runs through the sector: 34% already see themselves as entrepreneurs and 49% aspire to be.

Platform companies such as Bolt, which has 100,000 drivers on its books, are currently at sea as to what the rules will be. Will they, because of all this, be forced to offer full employment packages to those who would rather be flexible worker employees? Will this then increase the platform company’s costs and lead to layoffs, as more hours have to be offered to these workers, leaving fewer hours available to the self-employed?

My amendment seeks to get a commitment to a formal review of all this—and we just got that from the Minister—in order to ensure that the Government stand by their stated intent to consult fully, and I think that word is key, before changes are made. Platforms need to know what future employment categories will be allowed and how they will be defined because, one way or another, all of this will lead to their having to make very significant changes to their platforms. It is important that the Government have a full review and consultation before they decide on their detailed approach.

Platform companies can and must form a leading part of our future economy. As the noble Earl, Lord Clancarty, the noble Lord, Lord Clement-Jones, and others explained, as was the case with freelancers, so it is with platform workers. All employers and employees agree that, in these areas, flexibility is key and the Government have elsewhere committed to reducing, not increasing, inflexible regulation. This amendment seeks to hold the Government to that commitment.

Platform employers are investing hundreds of millions in their activities per country, per platform employer, in other countries around the world, yet are not doing so here in the UK. One platform company recently contacted me to say that they had withheld £170 million of investment from this country precisely because of this Bill and the threats it imposes on it.

We are falling further and further behind other modern economies, and it is precisely because of ever-increasing taxes and regulation, and the threat of more to come, from this and future mooted Bills. Removing the middle-stage worker status would both increase unemployment and deter further inward investment.

My amendment seeks to hold the Government to account on their promises to consult on the expected outcome of this part of the Bill, which the Minister has just done, and to figure out the likely impacts carefully in the hope that the most detrimental potential regulations might not be imposed. As we go into the summer break, we already see employment, particularly youth employment, plummeting. The NIC increases, the now very high minimum wage and the fear created by this Bill are causing employers to hold off further employment. All of this is leading to less and less hiring. I ask the Government to have pity on the employer, to have pity on the self-employed and indeed to have pity on our economy overall by agreeing to this, I hope, helpful amendment.