An MP has called on the government to ensure payroll companies do not deny workers their employment rights.
Leyton and Wanstead MP John Cryer led a Parliamentary debate last week calling for action to tackle “disreputable” payroll companies which encourage construction firms to register employees as self-employed to avoid paying them holiday pay, sick pay, redundancy and pension contributions.
Mr Cryer said: “This seems pretty disreputable to me, but what then happens, if the employer decides to go down the route of using a payroll company to transfer the work force into self-employment, is that the work force are asked to sign a contract with the payroll company.
“That is often sweetened slightly by a small rise in pay, but that will never compensate for all the other benefits and rights at work that in the meantime have been lost.”
After he raised the issue Labour’s deputy Shadow Business Minister, Ian Murray MP, urged the government to launch a full inquiry into bogus self-employment.