What does a Labour government mean for freelancers?

By Fred Hicks
Senior Policy and Communications Adviser, IPSE

Whether you’re new to freelancing or a seasoned pro, a change of government is big news if you’re your own boss. After 14 years of Conservative-led government, the business world is bracing itself for changes to tax, regulations and the economy.

Labour won the 2024 general election with the message of “change.” So just what kind of change can freelancers expect?

Shaking up the world of work

From exploitative zero-hours contracts to false self-employment, Labour wants to give working people a ‘new deal’ that will shake up their experience of finding and keeping work. But if you think this won’t affect you if you’re your own boss, think again.

Within the first 100 days of a Labour government, expect big announcements on ending ‘fire and rehire’, making working hours more predictable, and extending basic rights to workers from day one of an employment. Later down the line, they’re set to begin looking at bringing the titles of ‘worker’ and ‘employee’ together, giving everyone (apart from the self-employed) the same rights and protections.

This will undoubtedly change the equation for employers looking to hire staff. Whilst a great many workers will benefit from a rights upgrade, it could also make hiring a worker less appealing in some situations – which could create some extra opportunities for freelancers, depending on the sector.

And plans to create a single status of ‘worker’ for “all but the genuinely self-employed” raises the question of “who are the self-employed?” It seems like a straightforward question at first, but the real answer lies in tricky legal tests that top legal minds regularly argue over. Depending on the outcome, opening this question back up could make it easier – or harder – to prove that you’re a freelancer and not falsely self-employed.

Taking aim at late invoices

One of the biggest downsides to freelancing is the risk of being paid late, or even not at all. It’s a huge problem for freelancers, with IPSE research estimating that they’re waiting on a whopping £5,000 in overdue invoices on average.

Responding to campaigning by the small business and freelance sectors, Labour have also promised to “legislate to tackle late payments” which they say will unlock £20bn in late invoices.

As part of this plan, they’d force the boards of big companies to publish reports on their own payment practices as part of their annual reports, which get read by shareholders and journalists alike. The exact details are still sketchy, but the idea is that the scrutiny of how long they take to settle invoices and how many were overdue, will motivate companies to pay faster.

If the plan pays off, this could be a great thing for freelancers who contract directly with big firms. But it may not do much to help subcontractors, or anyone at the bottom of a long chain of suppliers.

Getting it in writing

Have you ever taken a gig without having a written contract in place? They’re something freelancers should always have, even for roles with regular clients who they’ve never experienced an issue with in the past.

Labour have said they want to give all freelancers a “right to a written contract”. Whilst they haven’t said exactly what this should look like, any good contract will at least specify payment deadlines, the scope of the project and what happens if either side fails to meet their terms. Depending on your line of work, intellectual property and corporate liability could also be relevant.

A new ‘right to a written contract’ would presumably make it more difficult for clients to find reasons not to provide one if asked. Government may even offer a basic template contract for freelancers to use as part of the initiative; but ideally, freelancers will take the initiative to write their own terms.

In-work protections for freelancers

An interesting twist in Labour’s offer to freelancers is the promise of more ‘in-work’ protections for freelancers.

Whistleblowing and blacklisting are difficult areas for freelancers who may feel they can’t speak up against malpractice they’ve witnessed at work, for fear of losing their gig and being shut out of their industry for good. Whilst the details aren’t yet clear, Labour have pledged to give freelancers blacklisting protections and whistleblower safeguards when in government.

The party has also committed itself to extending more health and safety protections to the self-employed – an important issue for a sector which has huge representation in the construction and building industries.