The government has responded to pressure to close loopholes that allow for "irresponsible companies to underpay workers" by voicing support for several recommendations laid out in the Taylor Review into employment practises.

The Work and Pensions Select Committee and the Business, Energy and Industrial Strategy Committee have prepared draft legislation to protect workers who are a part of the so-called 'gig economy', who employers sometimes take advantage of as a means to avoid tax and source cheap labour.

Matthew Taylor, who wrote the government-backed employment review, said: “This excellent report shows that whatever concerns the government has about my recommendations, parliamentary support is no longer a reason not to pursue them.”

The new draft bill calls for clear-cut definitions of modern employment status and basic rights for all employees. It also recommends higher pay for hours that are not guaranteed in a contract and states that companies should be legally obliged to provide workers with a written statement of their employment rights and entitlements before they begin work.

The Labour MP who chairs the Work and Pensions Committee, Frank Field, said the draft “would end the mass exploitation of ordinary, hard-working people in the gig economy”, and should be supported by the prime minister so that she may “fulfil the promise she made on the steps of Downing Street on her first day in office”.

"The Bill would put good business on a level playing field, not being undercut by bad business. It is time to close the loopholes," he said.

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