As we know the contract in itself may be an indicator but, just because there is a contract that describes an individual as an 'employee' or as 'self-employed' does not mean that it is necessarily the case.
Employment status can be most confusing to employers particularly when using consultants - are they self employed or workers? Some questions that we all ask in determining employment status are do they:
• regularly work for a single company or business
• have a contract which describes them as a 'consultant' or something similar
• provide specialist advice or assistance in connection with the operations of the business or specific projects
• provide services for a minimum number of hours/days each month/year
• report to the company's managers/directors, but are not under any direct supervision or control when working
• perform the work themselves and the company relies on their expertise
• submit invoices for work completed and are responsible for paying their own tax and National Insurance
• provide their own equipment
• often work from home or a private office, but go to the company's premises when necessary
However, the fact they are personally required to provide a personal service means that they are probably a worker. Their commitment to just your organisation means it is also unlikely that they are in business for themselves and so not self employed.
If the case ends in a tribunal we know the different factors will be looked at to determine the actual situation rather than the contract issued. A lot of employers think whatever contract they have will protect them.
Normally if they are self-employed for tax purposes, they will be self-employed in relation to their employment rights.
However, if they are self-employed for tax purposes it will not prevent an Employment Tribunal from finding that they are an 'employee' or a 'worker' for employment law purposes. HM Revenue & Customs decisions are not binding on Employment Tribunals although employers think they are protected if they have a HM Revenue and Customs letter.
