Single Status of Worker

Kate Dearden Excerpts

Wednesday 15th April 2026 Westminster Hall

[The Parliamentary Under-Secretary of State for Business and Trade (Kate Dearden)]

It is a pleasure to serve under your chairship, Mr Efford. I congratulate my hon. Friend the Member for Ellesmere Port and Bromborough (Justin Madders) on securing this debate and on his impassioned contributions throughout it. I know that, as my predecessor, he knows this agenda well. It has been a privilege to continue that work in my role. I was going to talk a lot about our Employment Rights Act and our wider plans to make work pay but in the interests of time I will not; my hon. Friends have covered those subjects exceptionally well and I thank them for that.

The world of work has fundamentally changed in recent years. As we have heard in this debate, it is no longer the norm to stay employed in the same company or even the same sector for a whole lifetime. New technology continues to transform the way that we work, and where and when we work. As the way we work changes, our employment rights legislation, which protects people, has had to be updated. That is what this Government are doing. I thank my hon. Friends for the many excellent points they have made in this debate about how we are working at pace to make sure that the environment for working people is much better than when we found it. My hon. Friend the Member for Ellesmere Port and Bromborough put exceptionally well how working people are already benefiting and seeing the impact that the Employment Rights Act and the other legislation that we have been working on are making.

I agree that to continue to progress in this area it is necessary to change the employment status framework for rights. The growth of the gig economy and growth in insecure work mean that some people are working without the certainty and stability that typical employment provides. The genuinely self-employed play an essential role in driving innovation, creativity and economic growth, and high-quality self-employment is a crucial part of our UK economy. However, vulnerable workers who work day in, day out, often in challenging conditions and for low pay, are not receiving the protections that they should. Their working conditions can be highly controlled by the people or organisations they work for, but they are nevertheless designated as self-employed, with no access to the national minimum wage, paid holidays, a workplace pension or protections from unlawful wage deductions.

The existing employment status framework can also be particularly difficult to understand and enforce. For someone to determine whether they are an employee, a limb (b) worker or genuinely self-employed can require the ability to understand both statute and a significant amount of complex case law. That presents challenges in a system where the onus is on the individual to bring a case to an employment tribunal to establish their employment status. It enables some employers to undercut their competitors—in this debate we heard many examples of that from different sectors—by misleadingly designating their workforce as self-employed when legally they are not, denying people the rights to which they are entitled, and exploiting the financial advantages associated with self-employment.

I thank hon. Members for mentioning the role of the Fair Work Agency on enforcement, and I am happy to continue the discussion outside the Chamber. I am sure that hon. Members will welcome the fact that the Government have set up a dedicated hidden economy team within the Fair Work Agency. From April, it will take action in sectors known to have egregious breaches of employment rights legislation, and act on illegal working and tax status.

We are committed to publishing a consultation on our plans to tackle employment status problems. It is important to look at whether the current test for employment status places the line between being a worker and being self-employed in the right place, and to consider how to improve compliance with the law so that everyone gets the rights to which they are entitled. Employment status is inherently complex, as we have heard in contributions to this debate.

I thank hon. Members for their time and consideration. We are doing lots of other work in this area, including for the self-employed, which I would like to talk about in further detail. However, in the interests of time I will not—I see you gesturing at the time with your pen, Mr Efford. I thank all hon. Members for contributing and thank my hon. Friend the Member for Ellesmere Port and Bromborough for securing the debate.