CIPD calls for gig workers' tax status to be clarified
Nearly 1.3 million people are engaged in gig work, but their employment status and rights are unclear and are in need of clarification, according to research from the CIPD which shows that two thirds believe that government should guarantee them employment rights
20 Mar 2017
The professional body for HR and people development carried out a survey of 400 gig economy workers, including 15 in-depth interviews, as well as more than 2,000 other workers.
It says the findings suggest 4% of UK working adults aged between 18 and 70 are working in the gig economy, and nearly two-thirds of them (63%) believe the government should regulate to guarantee them basic employment rights and benefits such as holiday pay.
The research also found that, contrary to much of the rhetoric, just 14% of respondents said they did gig work because they could not find alternative employment. The most common reason for taking this option was to boost income (32%).
Overall, gig economy workers are also about as likely to be satisfied with their work (46%) as other workers in more traditional employment are with their jobs (48%).
However, some raised concerns about the level of control exerted over them by the businesses they worked for, despite them being classified as self-employed. The survey found that just 38% of gig economy workers say that they feel like their own boss, and CIPD says this raises the question of whether some are entitled to more employment rights.
Peter Cheese, chief executive of the CIPD, said: ‘Our research suggests that some gig economy businesses may be seeking to have their cake and eat it by using self-employed contractors to cut costs, while at the same time trying to maintain a level of control over people that is more appropriate for a more traditional employment relationship.
‘Many people in the gig economy may already be eligible for basic employment rights, but are confused by the issue of their employment status.
‘It is crucial that the government deals with the issue of employment status before attempting to make sweeping changes, else they risk building foundational changes on shifting sands.’
CIPD’s research suggested gig economy workers themselves had mixed feelings about the extent to which gig economy businesses should provide employment rights and benefits.
Half (57%) agreed that gig economy firms are exploiting a lack of regulation for immediate growth, but a similar proportion (50%) also agree that people working in the gig economy choose to sacrifice job security and workers’ benefits in exchange for greater flexibility and independence.
Gig economy workers were equally likely to agree (36%) as disagree (35%) that ‘the gig economy should not be regulated and companies should compete to offer workers fair pay and benefits, even if it means less income and job security for people’.
The report also reveals that only a quarter (25%) of gig economy workers say it is their main job, suggesting most use it to boost their overall income rather than depend on it. However, 60% say they do not get enough work on a regular basis in the gig economy, and the research shows that income earned from gig work is typically low, with median reported income ranging from £6 to £7.70 per hour.
Despite the typically low earnings, gig economy workers 51% say they are satisfied and 19% dissatisfied with the level of income they receive. This is significantly higher than the level of satisfaction with pay reported by other workers, where 36% are satisfied and 35% are dissatisfied.
Cheese said: ‘We are pleased that the government has commissioned Matthew Taylor to lead a review of modern employment practices and look forward to working with his team. The government also needs to take a number of steps to help clarify people’s employment rights and enforce existing legislation better, such as supporting a “know your rights” campaign, so more people are aware of what protection they can expect.’
CIPD’s report, To gig or not to gig: Stories for the modern economy, is here.