If and when a new Employment Bill is finally introduced, the legislation will likely include the introduction of a new single all-encompassing enforcement body, which will replace, merge together, and extend the enforcement powers of the HMRC National Minimum Wage Enforcement, the Gangmasters and Labour Abuse Authority, and of the Employment Agency Standards Inspectorate.
On the 8th June 2021, the Government delivered its response to its consultation on its proposals for a new single all-encompassing enforcement body.
A New Single All-Encompassing Enfocement Body
The proposal to create a single all-encompassing enforcement body stems from the Government's 'Good Work Plan', which was the Government's ultimate response, published on the 17th December 2018, to the Taylor Review, which had been published on the 11th July 2017 (the Government's initial response had been published on the 7th February 2018). The Good Work plan incorporates 51 of the 53 recommendations made within the Taylor Review.
As highlighted above, the Government launched a consultation on whether to introduce a single all-encompassing enforcement body on the 16th July 2019. The closing date for submissions was the 6th October 2019, and the Government formally delivered its response to the consultation on the 8th June 2021. 111 interested parties had submitted their views on the proposals by the closing date.
In its response, the Government confirmed that it would now legislate to introduce a new single all-encompassing enforcement body which will replace, merge together, and extend the enforcement powers of the Gangmasters and Labour Abuse Authority, the Employment Agency Standards Inspectorate, and HMRC National Minimum Wage Enforcement.
The Government justified these proposals within its response by arguing that: "This new single body will support employers to comply with the law, building on the compliance activity of the existing bodies, and by providing detailed technical guidance as well as introducing a compliance notice system for lower harm breaches. It must also be more effective at identifying non-compliance. We will look to achieve this through better data use and analysis, as well as tackling the barriers that can prevent workers, third parties and employers from coming forward with information."
The Government added in its response that: "The body will have new powers to tackle non-compliance, with the introduction of civil penalties for underpayment.....breaches....that result in wage arrears. It will also have powers to enforce statutory sick pay, holiday pay and transparency in supply chains / modern slavery statement reporting."
Date For Introduction Of New Enforcement Body Unclear
It had been anticipated that the proposal to introduce a new single all-encompassing enforcement body would be included as part of a new Employment Bill, which was expected to be included in the Queen's Speech on the 11th May 2021. However, no new Employment Bill was included in the Queen's Speech
The BBC reported that: “Downing Street said an Employment Bill would be introduced “when the time is right”, citing the pandemic as the reason for the delay.” Accordingly, it is now highly unlikely that there will be any new Employment Bill before 2022 at the earliest.
Hence, the timetable for introducing the new enforcement body is unclear, and it is unlikely that there will be any new enforcement body before 2022 at the earliest.
Reaction
The Government's announcement in relation to the new enforcement body has been welcomed by the Freelancer & Contractor Services Association (FCSA).
The FCSA said in a statement that: "The FCSA welcomes the announcement that the proposed single enforcement body will have a remit to police the umbrella sector with a further emphasis on ensuring holiday pay for vulnerable workers is protected.The FCSA has long campaigned for regulation and specific legislation that further protects the agency and contractor workforce. There is now a clear statement from Government that umbrella regulation and the route to policing that regulation is on its way."
The FCSA added in its statement that: "The Government’s response is also clear that the merging of the separate bodies is not a money-saving exercise, and that further funding will be announced in the next spending review. This will be the key indicator of whether the Government is serious about driving out exploitation within our sector. The Government should be under no illusion that effective policing aimed, we hope, at rogue operators will require considerable investment."
