Casual Employees and Employment status

Some employers will be considering taking on extra staff on a 'casual' basis to cover the summer period. There are a few issues which employers should think about when taking on people on a temporary basis.

Firstly, the employment status of the worker needs to be carefully considered. The term 'casual worker' is not precisely defined in statute. It is often used to refer to individuals who are engaged on an 'as and when required' basis and often, the intention is that the individual will not have employment status and all the legal rights which permanent employees enjoy.

Essentially, for a contract of employment, three key elements must be present, namely:

  • The employee must be under an obligation to perform the work personally
  • There must be 'mutuality of obligation' between the parties - this means for example that you are obliged to turn up for work at specified times and not say you “cannot do tomorrow and that you’ll be in the following day” and the person you are doing the work for is obliged to give you work even for example if it is raining and
  • The employer must have sufficient rights of control over the employee.

If you are taking someone on as an Employee for a short time you may find this link useful. Read more https://www.gov.uk/new-employee/check-status

Important to note: If you are taking someone on as “self-employed” and they are “taking care of their own taxes” you may find that HMRC may look into this and rule the person is in fact “employed” and will be looking to you for the tax that should have been deducted, deeming the pay you gave them to be net pay. – Many contractors avoid this by using the services of an individual through a Limited Company as they cannot ‘employ’ a Limited Company. The  onus is then transferred to the director of the Limited Company and this is where IR35 comes into play.

HMRC provide a useful Employment Status Indicator, which employers can use to check the status of individuals, or groups of workers to see how they should be treated for tax and NICs.

Added By: Sue Taylor on 02nd Aug 2016 - 10:02
Last Updated: 02nd Aug 2016 - 12:05

Number of Views: 984
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