Self-Employment Review recommends equal treatment

19 February 2016

Julie Deane OBE, founder of The Cambridge Satchel Company, carried out the independent review of self-employment in the UK. The Government requested this review to find out what the challenges and opportunities are for those who want to work for themselves and to highlight the contribution they make to the UK economy and consider how they can be better supported.

The UK labour market is one of the most diverse in the world with self-employment accounting for over a quarter of the growth in employment since 2010. According to ONS figures, 1 in 7 people in employment choose to work for themselves, making a total of 4.5 million people.

An excerpt from the report:

“There is a clear desire for equal treatment and recognition from the Government for the self-employed and discrepancies should be reviewed. The support provided by Government to those starting or extending a family should be consistent whether the beneficiary is employed or self-employed.

i. Government should consider enhancing the level of Maternity Allowance provided to the self-employed in the first 6 weeks – bringing Maternity Allowance in line with Statutory Maternity Pay. As is the case with Statutory Maternity Pay the remaining 33 weeks would be paid at the lower of the statutory flat rate or 90% of earnings (in the case of low earners).

ii. Government should consider introducing a new ‘Adoption Allowance’ for self-employed adopters. In line with Statutory Adoption Pay, this should also be enhanced to 90% of earnings in the first 6 weeks - bringing ‘Adoption Allowance’ in line with Statutory Adoption Pay and the above recommendations for Maternity Allowance. The remaining 33 weeks of ‘Adoption Allowance’ should be paid at the lower of the statutory flat rate or 90% of earnings (in the case of low earners).

The description of ‘self-employed’ applies to a wide variety of individuals and sectors and there is currently no clear understanding of the employment status within many of these groups. The lack of a legal definition of self-employment is causing an issue. Simplification and clarification with a single definition for tax and employment law is desired and should be considered.

Read the full Self-Employment Review.