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**Zombie thread** Self employed and not getting paid.(19 Posts)
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Previous thread here. DH works in the construction industry as a site labourer and hasn't been paid by his company in over four weeks. They owe him a little over £3,000. I want to send a legal sounding letter, essentially threatening to take the company to the employment tribunal, but can he do this if he is self employed?
Facts that may be important:
DH paid weekly, into his account, by BACS.
The company automatically deduct 20% for tax, but do not pay national insurance.
If he doesn't turn up, or is sick, he doesn't get paid for that day.
He receives no holiday pay or other benefits.
He has no written contract.
The company is still trading and is a LTD company.
The boss spoke to DH on the phone today, and said he would definitly pay but couldnt confirm when, as they were having problems with a company that owed them etc. He said that some creditors were threatening court action and so he had to pay those ones first.
Its the self employed bit that has really confused me here - DH has 'worked' for the same firm for years, so we've never really classed him as self employed, but I'm guessing that bit is pretty crucial in deciding what course of action is appropriate.
I'm sorry for being so bloody clueless about this, but would really appreciate some help. 8 of DH's other close work friends are in the same situation, and none of them know what their rights are here,
threaten with small claims court. Send a letter saying that if all monies owed are not paid in full in however may days you will have no option but to start proceeding in the small claims court.
self eployed usually means he is a contractor - ie if another job with somebody else came up he could take it without giving any real notice to his boss, equally if the boss has no work he is under no obligation to find work for your dh or pay him.
Thanks Nancy - I have been googling for HOURS but not really sure what the correct procedure was. So I send a 'letter before action' telling them that if they have not paid by X date, then it will be taken to the small claims court?
I will come back and post a draft of my letter tomorrow and see if anyone is feeling kind enough to give me some feedback!
He has lots of rights (certainly the right to be paid, possibly the right to be classed as an employee with paid holiday, protection against unfair dismissal etc.) - but trying to enforce them is likely to end him up with no job and no prospect of a job from anyone else.
He could take them to court for payment of the outstanding money and they will probably pay up but he will never do a day's work for them again.
He could take them to an employment tribunal claiming unfair dismissal as he is in fact an employee. He may be awarded a few weeks redundancy pay, possibly holiday pay for this and previous years too - but being awarded money and receiving it is a different matter: the company may go bust (and start up again under a different name without any of the liabilities of the old company). He will never do a day's work for them or anyone else in the industry again.
Don't get me wrong, I think the actions of the company are deplorable and they shouldn't be able to get away with it. But they can, and tackling it head on will cost you financially: only do it if you can afford to lose.
On a slightly different note, does he do a self employed tax return?
Also if he is self employed, is he paying his ni on this basis (I know I have to) and if not why are the co not paying his ni? Sounds like a diddle to me ....
He said that some creditors were threatening court action and so he had to pay those ones first.
There's your answer.
MrA is right when he says that the company might take the hump and not use his services again, but if he is not being paid then it's no great loss. Look around for other work and try to avoid having all your eggs in one basket in future: that is having all the downsides of employment without any of the upsides.
All 9 men who haven't been paid have found work already (we are close to Olympic site- lots of construction work available!) and have no intention of going back to work for this compnau, so are happy to burn their bridges with this company.
MrA, he does his own NI but not a self em
Apologies, pressed post.
Does his own NI but not a self employed tax return.
My husband works in construction on the same sort of contract so I asked him. It's called SE60 in terms of tax purposes, you pay your own NI but they sort the tax through a third party company that deal with the wages such as Hudson. My husband believes that you would have a case for court as under his terms of being sub-contracted to his employer, and being on the books as an SE60 employee stops him working for anyone else without prior agreement of his boss. Somebody that works with my husband was dismissed last week for being caught working for another company out of hours. Although classed as self employed in terms of pay and benefits he is very much an employee in the respect of claiming for wages he hasn't been paid. It just seems to be a very common way to be employed in construction as it keeps costs down and makes getting rid of people quite easy should it be needed. I hope you get a resolution to this soon and feel free to PM me if you would like to ask my husband anything directly
Thanks so much for all your help so far, all of you. Below is a copy of the letter we are intending to send on behalf of all the men who have not been paid. Any feedback would be greatly appreciated.
We are writing to you regarding our outstanding wages, which have not been paid in over five weeks. We had previously been told on numerous occasions that the money was on its way to us, but this proved to be untrue each time, and to date we have still not received payment for the work we have carried out. Unfortunately, as our repeated requests for payment have been ignored, we have no option but to make this a formal situation.
- Amounts outstanding listed -
Unless payment is made to the above persons within 14 days (Wednseday 26th October), Legal Action to recover the debt will be taken against you without further notice. If the payment is not received by this date, we will have no option but to start a claim in county court, which will involve additional costs for you, such as court costs. Please be aware that under the Late Payment of Commercial debts acts of 1998, we are entitled to add on interest of 8% to the amount already owing. If all outstanding payments are received by the 26th, we will not proceed with court or interest claims.
I can confirm that we would be agreeable to mediation and would consider any other system of Alternative Dispute Resolution in order to avoid the need for this matter to be resolved by the courts and would invite you to put forward any proposals in this regard.
We look forward to hearing from you within the next 14 days with how you wish to proceed in this matter. Should we not receive a response to this letter within this time frame then I anticipate that court action will be commenced with no further reference to you.
this was a common problem in the past with the SC60 scheme ( as it used to be called) - is it possible to check that the deductions from the monies he has been paid have been paid over to the Revenue. In the past I worked on a number of cases where unscrupulous 'employers' did not keep within the rules, including those working on government funded projects. if you have an accountant ask him to contact the Revenue to check whether deductions have been paid over, this does not help you with your current problem but it may well assist in you making a decision as to how to enforce payment of what is due, and give you a bit of leverage if you say that you are involving HMRC.It is easy to take court action but a damn site harder to actually get the money.
He still has to do a tax return. How does he pay NI if he doesn't do a tax return?
My apologies for misinterpreting the situation, when you said he has worked for the same firm for years I assumed that he would want to continue to work for them, assuming they survive the current cash flow crisis.
You see suing people you do subcontract work for is usually a lose-lose situation. If you don't sue them and they go bust, you won't get paid. But if they survive you will probably get paid eventually, and will also get to work for them in future. If you sue them and they go bust you still never get paid, but if they survive you do get paid but lose out on any future work.
hi, I have worked for Amazon as a self employed driver through a courier called MCH, Also known as (prospect commercials) my company van was stolen and later recovered but parcels were missing. I was sacked my MCH and they have know stopped my 3 weeks pay plus the fuel money without any notice at all. when I contact my boss he just says 'mch have stopped your money because you owe amazon money for missing parcels'. Are they allowed to stop my money by law without any notice as a self employed.
I too am very confused as to how your dh is self employed - which he clearly isn't, because he doesn't meet the criteria - you can look these up.
This is not unheard of. Many many companies try and get away with this. Treating people as self employed, when really they are clearly employed.
And no tax return?
You need to consider this. Once you've got this initial problem of his missing wages sorted.
Thanks for the warning, mumblechum0 - god these zombie threads are annoying.
It is indeed a zombie thread folks. We've changed the title now to let people know.
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