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Dependent Forms of Self-employment in the UK: Identifying Workers on the Border between Employment and Self-Employment

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Author Info
René Böheim (Department of Economics, Johannes Kepler University Linz, Austria and IZA, Bonn.)
Ulrike Muehlberger () (Department of Economics, Vienna University of Economics & B.A.)

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Abstract

We analyse the characteristics of workers who provide work on the basis of a civil or commercial contract, but who are dependent on or integrated into the firm for which they work. We argue that these dependent self-employed lose their rights under labour law, receive less favourable benefits from social security protection and are often beyond trade union representation and collective bargaining. Using data from the British Labour Force Survey we test two hypotheses: (1) Dependent self-employed workers are significantly different from both employees and (independent) self-employed individuals, thus forming a distinct group. (2) Dependent selfemployed workers have lower labour market skills, less labour market attachment and, thus, less autonomy than self-employed workers. The data support our hypothesis that dependent selfemployed workers are a distinct labour market group which differs from both employees and independent self-employed individuals. Men, older workers, those with low education and a low job tenure have greater odds of working in dependent self-employment than their counterparts. Our results suggest that dependent forms of self-employment are used by firms to increase labour flexibility.

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Paper provided by Vienna University of Economics and B.A., Department of Economics in its series Department of Economics Working Papers with number wuwp091.

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Date of creation: Feb 2006
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Handle: RePEc:wiw:wiwwuw:wuwp091

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Find related papers by JEL classification:
K31 - Law and Economics - - Other Substantive Areas of Law - - - Labor Law
J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure

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  1. Judith Freedman & Emma Chamberlain, 1997. "Horizontal equity and the taxation of employed and self-employed workers," Fiscal Studies, Institute for Fiscal Studies, vol. 18(1), pages 87-118, February. [Downloadable!]
  2. Cowling, Marc & Taylor, Mark, 2001. " Entrepreneurial Women and Men: Two Different Species?," Small Business Economics, Springer, vol. 16(3), pages 167-75, May. [Downloadable!] (restricted)
  3. Fabio Berton & Lia Pacelli & Giovanna Segre, 2003. "Tra lavoro dipendente e lavoro parasubordinato: chi sono, da dove vengono e dove vanno i lavoratori parasubordinati," LABORatorio R. Revelli Working Papers Series 25, LABORatorio R. Revelli, Centre for Employment Studies. [Downloadable!]
  4. Robson, Martin T, 1998. " The Rise in Self-Employment amongst UK Males," Small Business Economics, Springer, vol. 10(3), pages 199-212, May. [Downloadable!] (restricted)
  5. Taylor, Mark P, 1999. "Survival of the Fittest? An Analysis of Self-Employment Duration in Britain," Economic Journal, Royal Economic Society, vol. 109(454), pages C140-55, March. [Downloadable!] (restricted)
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