Russell Lynch: Don’t throw this ‘gig economy’ baby out with the bathwater

As a woman of precarious employment, Theresa May must be the perfect prime minister to hold forth on the gig economy.

But today’s Taylor Report on employment practices merely underlines the extent to which her original ambitions for the office have been diminished by the loss of her majority.

Almost exactly a year ago, driven by her now-departed adviser Nick Timothy, blue-collar Conservativism was the big pitch: her first speech stressed the issue of “job security” and an “economy that works for everybody” to tempt Labour voters.

But her ideas for workers’ representatives in the boardroom, for example, didn’t last the autumn and the tone of Matthew Taylor’s report feels like tinkering around the edges of the “gig economy” rather than a revolution. Taylor says bosses “have nothing to fear” and the unions are lamenting a missed opportunity.

One of the big ideas, forcing firms to be more transparent and show that workers can earn 1.2 times the £7.50 national living wage, is welcome because people dipping their toe in the gig economy have a right to know roughly what they might bring home. But the second one, creating the new status of a “dependent contractor” with limited employment rights feels like reinventing the wheel.

Unions say the devil will be in the detail, but there is already a status in law that looks very similar, called a “worker”. They’re the middle ground between full employees and a self-employed contractor; a type of freelance who has a contract with an employer to carry out work but is entitled to the national living wage and holiday pay.

The more egregious recent abuses have come when “workers”, who have to wear a uniform, for example, have been treated for employment purposes like independent contractors. Done simply for employers to avoid national insurance contributions, that is plainly wrong.

Overall, though, the report is wise not to throw the baby out with the bathwater. Unions are right to flag up flagrant abuses, but most people work in the gig economy out of choice, encouraged by the flexibility and independence it offers.

And compared with the likes of France, for example, our more liberal employment set-up is a key draw for business, and needs to remain that way after Brexit.

Remember too that unemployment is at its lowest level for 40 years, one of the few silver linings of a decade or more of lost earnings. By clamping down too hard on the innovators, we risk sending the wrong signal to the rest of the world and potentially hurting the low-paid workers we’re trying to help.