I always tell clients that working out employment status is more like painting a picture than ticking a checklist.
The employment status of people in an organisation and how it affects their rights has been something I have been looking at and trying to understand for the last 25 years or more!
Recent high profile cases in the media and a government review have placed the spotlight on employment status.
I see all sorts of arrangements – self-employed freelancers who should be employees, casual workers who are treated like employees, and volunteers that could be considered employees.
In my role of supporting small charities and social enterprises with their people issues, I have had to ask my clients lots of questions. Questions to unravel what has been agreed in writing and what happens in practice with the people that carry out work for them.The key areas where I ask questions are:
- How much control do you wish to have over when the individual works and what they do?
- The extent of mutuality of obligation, i.e. to what degree will you have an obligation to offer work and to what extent will the individual be obliged to accept this work
- The need for the individual to carry out the work personally, rather than sending a substitute.
- Does the individual provide their own equipment?
- The proposed length of the working relationship.
- The degree of financial risk on the individual carrying out the work for you.
- The degree of responsibility for investment and management.
- Whether the person works mainly for you or for a number of different people/organisations?
The more control you wish to have over the individual and expect the individual to carry out work when given to them, then the more likely that the individual is an employee and not a worker or self-employed. An employee, worker and self-employed freelancer/consultant have different rights in law and an earlier blog describes these differences.
It is important therefore to determine the type of working relationship that you wish to have with the individual and this emerging picture will determine whether the working relationship required is best met by an employee, worker, or self-employed freelancer/consultant.
If you are unsure how you should be managing a working relationship then please do contact me. Remember I offer free HR phone advice every Wednesday between 10-12pm.