The minimum required? Minimum wages and the self-employed

The minimum wage revolutionised the lower end of the UK’s labour market, protecting employees from exploitation. But the self-employed – now one in seven of the workforce – are not entitled to the minimum wage. With growing concerns over their earnings and conditions, particularly in the so-called gig economy, extending the minimum wage to some of this group has been discussed. While a minimum wage would not be appropriate for the majority of the self-employed, for those who take work from firms or platforms and – crucially – don’t have control over the price they charge, moves to reduce exploitatively low pay for this group would be both meaningful and welcome.

Existing legislation on ‘piece work’ done by employees provides a useful template, in which firms offering work complete a test to ensure that a person working at an average pace could be expected to earn at least the minimum wage while carrying out the task. This measure alone will not assuage fears about poor quality self-employment; greater enforcement of employment law and closing the gap in the tax and benefit treatment of self-employed and employees as well is vital. But ensuring firms using, or helping provide, self-employed labour set fair rates would be a helpful step towards better self-employment.