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Contracted or Self-employed staff


Oksana1975
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Hello everyone,

 

I would really like to hear about benefits and disadvantages of having contracted and self-employed staff.

 

I have a member of staff who I am planning to switch from contracted employment to self-employed as I need to cut her hours but was told that HM Revenue might raise their eyebrows.

 

Once she starts as a self-employed from Sep, should she simply invoice me for each month? Do you hold a special register for self-employed practitioners?

 

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Be careful. I don't think you can decide that someone is self employed there is a legal definition.

I found the following about tax law

 

Someone is probably self-employed and shouldnt be paid through PAYE if most of the following are true:

 

theyre in business for themselves, are responsible for the success or failure of their business and can make a loss or a profit

they can decide what work they do and when, where or how to do it

they can hire someone else to do the work

theyre responsible for fixing any unsatisfactory work in their own time

their employer agrees a fixed price for their work - it doesnt depend on how long the job takes to finish

they use their own money to buy business assets, cover running costs, and provide tools and equipment for their work

they can work for more than one client

 

I couldn't answer yes to most of the above so probably couldn't be self employed.

Hubby (who contracts his services) has to be careful not to work with one company for too long as hmrc need to assured it is not the company avoiding employers ni etc.

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We had a dance teacher coming in once a week who is self employed - different situation in that we wanted her to come in for the dance session but we paid her more than we'd pay staff as she has to cover her NI, tax etc.

 

We do have one member of staff who's been doing 1 day a week plus cover for less than a year and from Sept, we can't guarantee what hours she'll have so are have changed her to bank staff. She'll still be employed by us for the hours she does but if she doesn't do any hours one month, won't get paid that month.

 

It's a tricky thing though as if she does end up doing a similar amount of hours each month, we'll have to put her back on contract as there clearly will be a need for her to be doing those hours.

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The employee wants to work as a self-employed. This will give her a flexibility to work as a bank staff for other settings.

 

from Sept, we can't guarantee what hours she'll have so are have changed her to bank staff.

 

Exactly the same situation is here. I cannot guarantee the hours.

 

Can someone give me a link to the similar conversation. I cannot find it.

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Beware.. as self employed technically she could charge whatever she wants per hour for working , you cannot say she has to charge xxx per hour for her services.. it is her decision on what to charge.. you may need to agree a sum before every time she works at the setting, either per hour or per day

 

She should really give notice so you can give her the P45 at end of her employment with you, and then apply to be offered hours you may have as self employed.. as casual self employed staff, or bank??

 

Must admit all our staff were on zero hours contacts and understood that they would change in Sept if we needed to , but would be increased as soon as we could. All were aware that without this we would have to reduce staff and someone would lose their job, causing issues later in the year when we needed to re employ on short term contracts. They preferred to reduce hours to keep the stable staff they knew and who all worked well together, we had a few 'unsuitable' staff at one time and it caused many issues for all..

 

I used to work as bank with several settings for a while,I was on their books and paid as normal ,had tax code split between them.. was not an issue other than a clash in days occasionally.

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Thank you Inge for your advice.

I have seen her today and offered two days but to continue on contract. She has happily accepted my offer. I will still need to review the contract and some minor changes might need to be implemented.

She has attended many trainings while being with us, so I really do not want to loose her.

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