MPs in the Work and Pensions Select Committee are calling for an end to ‘bogus self-employment’ practices. During an assessment of modern employment practices, MPs named and questioned companies such as Uber, Amazon and Deliveroo.

Frank Field, the chair of the committee, said; "Companies in the gig economy are free-riding on the welfare state, avoiding all their responsibilities to profit from this bogus ‘self-employed’ designation while ordinary taxpayers pick up the tab.”

MPs also said that the use of self-employed workers in the so-called gig economy rather than salaried employees undermines workers’ rights while reducing the government’s tax revenue.

During the inquiry, the committee accused companies of propagating a myth about self-employment and rebuffs their claims to be providing flexibility for workers. 

The report said: “Companies relying on self-employed workforces frequently promote the idea that flexible employment is contingent on self-employed status. But this is a fiction.”

“When pushed, however, Deliveroo, along with Amazon and Uber, conceded that their business models would still be viable if they took on couriers and drivers as employees. They might simply be less profitable.”

Last year, a London employment tribunal ruled that Uber drivers in the UK should be classified as workers and not self-employed, thus entitling them to rights such as the minimum wage and holiday pay. Uber plans to appeal the ruling. While companies such as Hermes, Deliveroo and Amazon have previously come under criticism over their employment practices.

In April 2017, MPs criticised gig economy contracts during a Commons Work and Pensions Committee, calling contracts from Uber, Amazon and Deliveroo “unintelligible” and claiming that the contracts prevent people from challenging their employment status.

In a statement, Uber said: “The vast majority of drivers who use Uber tell us they want to remain their own boss as that’s the main reason why they signed up to us in the first place. But we know drivers want more security too, which is why we are investing in a heavily discounted illness and injury cover offer for drivers.”

Julia Kermode, chief executive of The Freelancer & Contractor Services Association (FCSA), also commented, “Employers should not shirk their responsibilities to provide basic workers’ rights so I support Frank Field and the Committee’s mission to stamp out exploitative working practices. However, I think it is important to point out that there is no evidence from the recent Office for Budget Responsibility Economic and Fiscal Outlook to show there is any tax loss to the public purse arising from increasing self-employment.  And, while we must protect vulnerable workers, we should also be mindful that the vast majority of self-employed professionals choose to operate in this way and do not want or expect employment rights, nor do they feel exploited.""I am concerned that the Committee’s move to redefine employment status might have a significant impact on genuine self-employed workers so it is important to consider all types of “workers” before adding an extra layer of red tape or introducing any legislation that might hinder the UK’s self-employed professionals who are driving the UK economy right now,” Kermode said. A report on modern employment practices and the gig economy commissioned by Matthew Taylor is due to be published later this summer.