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False self-employment is headline news
The government’s focus on false self-employment has led to two prominent and successful businesses coming under intense media and official scrutiny.
False self-employment – where a worker is engaged on a self-employed basis but performs a role as if employed – has been a hot topic in the recruitment industry for some years. But an HMRC inquiry into the employment practices of the parcel delivery company, Hermes, and a case being brought against Uber by some of its drivers are bringing it much more into the public domain.
Whatever the outcome of these cases, we can expect to see more high profile investigations of employers accused of avoiding paying the living wage by engaging workers on a self-employed basis.
How to keep on top of false self-employment
Determining whether a worker is truly self-employed ultimately comes down to ‘supervision, direction or control’ – how much an organisation dictates what a worker does, when they do it, and crucially, how they do it.
HMRC’s starting point is that all workers providing their services via an employment intermediary are under the supervision, direction or control (SDC) of the end-user.
To demonstrate that they’re not, you’ll need to establish whether the end-user client (this could also be a manager or foreman) tells the worker what to do and how to do it. This might include overseeing how the work is done, controlling when it is done and moving the worker around the site as the client chooses.
Sounds complicated? Don’t worry. If workers are engaged via Payme, then we will conduct the SDC check. We may, however, need support from you and your end-user customer.
Establishing a worker’s status has other benefits too – a worker who does not fall under SDC may be to entitled to home-to-work travel expenses. So our SDC check ensures workers do not miss out.
If you want to know more about our procedures, call us now on 0333 200 0845.