In a new report, the TUC said that almost half of self-employed in the gig-economy aged 25 or over were earning less than the minimum wage
Wages for those working for themselves were far lower than for employees and had actually fallen in the latest year.
Of the four million adults over 25 classified as self-employed, 49% (1.96 million) were earning less than the current minimum wage, the TUC said.
The TUC said the self-employed aged 25 and over earned £12,300 on average in 2016-17, down from £13,200 the previous year, and well below the average of £21,600 for employees and self-employed combined.
TUC’s general secretary, Frances O’Grady, said: “Self-employment can be a great option but it’s clear that it’s not working for everyone, with millions of self-employed workers stuck on poverty pay. Too many workers have been forced into sham self-employment – like at Uber and Hermès. It’s not about helping workers. Theresa May promised to change things for ‘just about managing’ families but she’s done nothing. She should be cracking down on businesses that use sham self-employment. She should ban zero-hours contracts. And she should give agency workers the right to equal pay to stop undercutting and encourage employers to create more permanent jobs."
“The two million people in low-paid self-employment are part of at least 3.7 million people in insecure jobs. The other 1.7 million include agency workers, casual workers, seasonal workers and those whose main job is on a zero-hours contract,” the TUC said.
Self-employment has risen from 12% to 15% of workers since 2001, with a particularly marked increase in the years after the financial crisis of a decade ago. Including the under 25s, the Office for National Statistics says the total stands at 4.8 million. The TUC believes the growth in self-employment has been caused in part by an increase in sham forms of employment, where workers who would once have counted as part of a company’s payroll are treated as self-employed to reduce tax liability, duck the minimum wage and deny workers their rights. It added that bogus self-employment included some gig economy workers and people who were contracted to a single employer through a personal service company, rather than being contracted as an employee.
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