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Engaging Contractors: Employee or Contractor?

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It all depends on the status of the engagement. The IR35 framework is designed to highlight so-called “disguised employment”, which is where a company engages workers on a self-employed basis and usually through an intermediary or Personal Services Company (PSC), rather than on an employment contract, so they become disguised employees. From April 2020, medium and large companies that engage individuals who work through an intermediary or Personal Services Company (PSC) will be responsible for determining the IR35 status of their workers, rather than allowing the workers to define this themselves.

Employee vs. Contractor: The 3 Main Principles

The three main principles to decide IR35 status include the following:

Supervision, Direction, and Control: What degree of supervision, direction and control do you have over what, how, when and where the worker completes day to day work?

Substitution: Can the worker send someone else to carry out the work?

Mutuality of obligation: Are you obliged to offer work to the worker and are they obliged to accept?

 

Potential rules around “relevant engagements”

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Redline offer knowledge-led, tailor-made recruitment programmes to suit clients’ specific needs. We adopt a ‘partnership’ approach to ensure a detailed understanding of clients’ objectives and requirements. For more information regarding how we can help your business, please contact Peter Livingstone, Director of Contracts & Interim on 01582 878852 or email PLivingstone@RedlineGroup.com