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Labour win a historic landslide

Alison Roberts

Alison Roberts | Legal Director

Friday 5th Jul, 2024

Last night the country took to the polls and a new political party was announced. Kier Starmer will lead the Labour Party into their first term in over 14 years and whilst adjusting ourselves to a new regime, the country should also prepare itself for change.

To make up for lost time, Labour intends to act quickly; they have committed to introducing new legislation into parliament within 100 days of entering government. To reassure business though, Labour has also said it will follow a full and comprehensive consultation and parliamentary process, setting itself out as both a party that is “pro-worker” and “pro-business.”

Our industry has been calling for change for many years. We want to stamp out the rogue operators that damage the reputation of our industry, undercut the economy, and cause in some cases, devastating consequences to workers personally.  Early indications from Labour are therefore welcome.

Labour has pledged to tackle tax evasion. This includes £555m in extra funding to HMRC, from which 5000 new HMRC compliance officers would be recruited. We hope that a proportion of this additional funding will be allocated to tackling non-compliance in our industry.  

Also at the heart of Labour’s proposal is the protection of workers. Although promised for many years, the Conservatives never created a single enforcement body, yet Labour has already committed to this plan to “ensure employment rights are upheld.” It would also be useful for the new government to establish an easier test to determine whether someone is employed, a worker or self-employed and Labour has indicated that it may move towards a two-part framework for employment status.

All signs are currently positive that Labour will support our industry in stamping out unscrupulous operators, something we have always welcomed and continue to support; and that Labour will do more to improve the accessibility of employment rights for workers. We look forward to Labour making headway on the Tackling Non-Compliance in the Umbrella Company Market consultation. Although the Conservatives hinted towards due diligence being their favoured route to enhancing compliance, Labour may well go further by introducing the transfer of liability to others in the supply chain, similar to how it operates under IR35. Perhaps too, Labour will put the concept of a licencing regime back on the table.

Change is upon us, and we’re ready for it!

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Effective January 6th, 2024, the primary National Insurance rate has been slashed by 2%, decreasing from 12% to 10%. This substantial cut, surpassing 15%, translates to a £450 savings for the average salaried worker earning £35,400, contributing positively to their finances this year.

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