10 Years and Nothing!!

[GreatBigHooAndToodaloo]

I don’t even know what my AIBU is. My head is spinning. I’ve name changed for this because it could be outing.

I’m furious. My DH has worked for the same man for 10 years. He is a highly skilled tradesman (engineer) His bastard boss refused to take him on as an employee even though he wears the uniform, drives a sign written vehicle, works set hours and doesn’t do any other private work. He is essentially an employee without any of the benefits. The bastard boss hides behind the CIS scheme so that he can get all the benefits of having an employee without the faff. My DH hasn’t had a single day of paid holiday or sick leave for nearly 10 years.

Bastard boss comes to the house after work on Friday and announces that he is closing the company and moving overseas in a weeks time. One week!

He has also made it clear that there will be no redundancy pay. He got the work vehicle evaluated and has said my DH can buy it from him. He showed the evaluation to my DH. He is refusing to give him any discount on it. Not a single penny. I’m furious and heartbroken. I don’t know what we’re going to do.

Does anyone have any advice? Is there anything we can actually do? Ten years of loyalty. Ten years!

@GreatBigHooAndToodaloo

Right, let me just clear something up here, we knew how this worked when we went into it. We accepted the deal knowing there were no holidays etc. That’s fine. But those of you who are basically saying it’s tough luck, how would you feel? You give ten years of your life to a company, never complain, make them millions of pounds, work 6 days a week most weeks and remain loyal to the company even though you know it’s a little more than just subcontracting and that you deserve better. Then he; A. Gives you one weeks notice to sort out a new income and B. Doesn’t offer any sort of gesture, not even a small discount on a van, in thanks for your service. I don’t think anyone would be happy in these circumstances so just back off!

To everyone else, I really appreciate your kind words of encouragement and all the advice that you have given. You’ve all really helped and I’m actually feeling quite positive and excited for the future. Lessons have been learned and we are better off in the long run. Thank you all so much! 💐

My DH is a sub-contractor - like your DH, he's also been with the same company for several years. But we both know he could be let go at a moments' notice - it's why he gets paid what he does.

But he's also not loyal to his company for that reason - he's there because it's convenient and if something better came along, he'd leave. Just as he knows his company would let him go if someone better and cheaper came along. That's part of the business. You can't take it personally - it's about money, nothing more.

Nobody is saying your DH should be happy, but this is all part of being a sub-contractor. It's why he got paid good money. He didn't have to work six days a week or remain loyal to them - that was his choice, and unfortunately it's blown up in his face somewhat. Like you say, it's a lesson learnt and he won't make the same mistake again.

@Shelddd he was not on price work. He received a set weekly wage. We have just signed with one of his developers this afternoon who have forwarded us invoices and quotes from the last 3 years. Some jobs are in the region of £16000 for two days work. Which my husband did and received a day rate for. My DH was paid less than 5% of that figure for doing the job over two days. Turns out what I thought was good money really wasn’t. I have learned a lot from this thread. I have also done the HMRC questionnaire posted by someone further up thread. He really was technically an employee and not a contractor according to HMRC. So no, I will not be thanking someone who exploited my husband for 10 years.

[quote GreatBigHooAndToodaloo]@Shelddd he was not on price work. He received a set weekly wage. We have just signed with one of his developers this afternoon who have forwarded us invoices and quotes from the last 3 years. Some jobs are in the region of £16000 for two days work. Which my husband did and received a day rate for. My DH was paid less than 5% of that figure for doing the job over two days. Turns out what I thought was good money really wasn’t. I have learned a lot from this thread. I have also done the HMRC questionnaire posted by someone further up thread. He really was technically an employee and not a contractor according to HMRC. So no, I will not be thanking someone who exploited my husband for 10 years.[/quote]
Give it a rest OP. You've said yourself you knew exactly what you were getting into. You've also said you knew he should be any employee not subcontractor but your husband stuck around for the financial benefits. Your husband was happy to continue with being a subcontractor because it paid well and he didn't have to pay as much tax as an employee.

I'm not sure why you're so outraged that the contractor was earning significantly more than your husband. I honestly can't work it out. Even if he was an employee, do you think the shareholders of Tesco strive to make sure they don't want more than their employees? You either have a very, very poor grasp of basic business, or you're in denial.

Don't earn more*

So no, I will not be thanking someone who exploited my husband for 10 years

Wow, you genuinely believe your husband bears no personal responsibility for his employment choices and he was exploited and owed?

Is there a back story with him that is making you feel this, that he isnt capable of understanding or being personally responsible?

OP. I was one of the people who I hope gave you positive advice and told you this could in fact be a gift going forward. But there are elements of this where you are not being realistic and focusing on the wrong things.

You really need to stop with this victim mentality as it’s wasting valuable energy and taking away the focus of what you and especially your husband should be concentrating on.

You say about previous invoices you have now seen but these are quite normal. Your DH was never going to be paid 50% or 75% of the invoice that’s just business. He was paid a contractor wage with those conditions that he accepted for a decade. For those years it worked well otherwise presumably he would have left having looked for alternative employment or setting up his own business. Running a business is hard believe me I know. It’s draining, gives you sleepless nights, financial headaches and stress. That’s why the boss who takes the risk and the financial strain and burden gets the major spoils. But if it goes wrong they also pay the price.

Your DH has not been in that position but now going forward he has the chance to do so but with all the downsides that being the boss holds! It may well give him much higher financial rewards but it’s not all plain sailing as you will discover. This is your/his chance but you really do need to plough all of your energies in finding a way forward and capitalising on those clients that will give a future and actually accept this wasn’t what your DH had chosen as a previous path. Instead he chose to stay as a contractor with the benefits and limitations that exactly that type of employment offers. Yes it’s tough the short notice but that’s the world he was in. Now move forward.

So no, I will not be thanking someone who exploited my husband for 10 years.

How, exactly, was he exploited?

[quote GreatBigHooAndToodaloo]@Shelddd he was not on price work. He received a set weekly wage. We have just signed with one of his developers this afternoon who have forwarded us invoices and quotes from the last 3 years. Some jobs are in the region of £16000 for two days work. Which my husband did and received a day rate for. My DH was paid less than 5% of that figure for doing the job over two days. Turns out what I thought was good money really wasn’t. I have learned a lot from this thread. I have also done the HMRC questionnaire posted by someone further up thread. He really was technically an employee and not a contractor according to HMRC. So no, I will not be thanking someone who exploited my husband for 10 years.[/quote]
So he was getting 400 a day.. that's like 90k salary. Do you think he would get that if he was working full time perm? I really doubt that.

I think OP wants there cake and eat it when it come to employee v sub contractor

You both knew this guy was a shit from the start. What kind of employer refuses to actually employ their employee, to get out of paying them holiday and sick pay? A bad one, that's what. He was always a weasel, how did the two of you not see that? He only ever looked out for himself, which is something the two of you should have done from the start. He was always going to screw your husband over. Because he never cared. I dunno why you were both naive enough to think he was.

Best you can do is crack on with building a new business based around it, and quickly before one of the others does it. Trying to sue etc is pointless, the guy has won.

@rwalker
Along with many others on this thread you may be confusing being a sub contractor with the CIS scheme. The CIS scheme has rules, the 'employer' may have breached them.

@DameCelia self-employed (cis) / subcontractors don't get redundancy .
CIS is deemed selfemployed

Yes @rwalker but the point made excellently up thread is that the CIS rules may have been breached, many an employment situation arose and therefore the redundancy situation may be different.

Honestly, you may find that this is the best thing that has every happened to you!

My dh is a roofer and 5yrs ago had quite a serious accident that meant he couldn't work for a number of months. He was on a similar CIS lark!

He set up on his own, it was odd jobs at first as that was all he could physically do, but not he's got worked booked in months ahead, leases a van and has a really good reputation. He's finally taken the plunge and taken a labourer on recently. He's also earning more than ever!

I work full time +, so I don't do much for him, but you sound really on the ball. I'm sure it will work out for you, good tradespeople are very much in demand and he already has a whole heap of contacts.

@sasparilla1 thank you so much for that! I am feeling so positive today. We have already secured a few contracts and things are going to be better than ever.

@DameCelia thank you for trying to explain it to people. No one really seems to get it. It wasn’t subcontracting there were no contracts. He went to work for the guy in his uniform, in his van, for his clients, on his terms and conditions, a normal 8-5 start and finish, no time for personal work, no personal expenses and a set wage. Just like a normal employee. Except he had none of the perks. The company even deducted his taxes every week. We have been looking at jobs today just to compare and his salary could easily be matched by the likes of British Gas etc. I don’t know where someone up thread got £90k because it was nowhere near that figure. Thanks again!

But yes.. I completely accept that we were stupid and naive and that we allowed this guy to get away with it. Onwards and upwards and moving forward now.

I hope you are able to turn this into an opportunity now, and it seems like you could. Though might be best to at least try and check the van is rightfully the boss's to sell! I would also make a lower offer as it's the boss who wants to sell the van quickly.

However
I never thought he’d do something like this to us
I think after 10 years of this and how you've said the boss handled furlough last year, then you could have guessed he wasn't going to be handing anything out. Shouldn't have been a surprise. You may need to keep an eye on how your husband runs it as his own business to avoid him taking the 'easy option' that means you lose out later.

I would say that the other company has breached GDPR rules unless they had the contractors permission to send copy invoices to you. But anyway...

As others have said, you are in business to make money. You will need to do this yourself in order to make money, you will need to charge the companies you work for, far far more than you pay to your employee.

The contractor has other expenses to pay for , materials, tools, Public Liability Insurance, Membership fees, vehicle costs, Accountancy fees, advertising, and lots of other things, so all of that needs to come out of what you charge to your customers.

So when you employ somebody, and well done for saying that you are going to do that, employing them means that they will get holiday pay and sick pay, and hopefully you will pay them a decent wage, but you will not pay them anywhere near what you charge to your customer.

Of course it seems unfair, but all your DH had to do was turn up and work, he didn't have any of the other costs that the contractor did.

Good luck with everything ongoing, and my best tip for you, is to ensure that you put away your tax money each month, into a savings account, so that it is there when you need to pay your tax.

I expect this has been mentioned - but I think it's the IR35 rules that prevent self employed people from working for only one 'employer'? Many people used to choose to be 'self-employed' as it's often more beneficial, so they made it illegal.

Your DH has missed out on things like holiday pay but that may have been reflected in his rates. He has broken the law by claiming all the benefits that go with being self employed - if you go to HMRC now you may find that comes back to bite him big time!

He could (and maybe should) have raised this years ago as from what you have said, he clearly was an employee. But you would need to look at all the expenses he's claimed, any additional pay he's been given, etc etc and weigh that up against lost holiday and sick pay, and redundancy. It may not be worth the battle - and he could possibly be fined for breaking IR35 rules anyway.

Good luck with the new business.

@Skiptheheartsandflowers you’re right. We should have known and been smarter. Hindsight is always 20/20 isn’t it! We’ve done an HPI check, it’s all above board.

@fakeplantsdontlookreal thanks for your input. The tip about putting taxes into savings is great! Thanks so much.

@Teenagehorrorbag I’m not sure how my DH has broken the law? It wasn’t up to him to make sure he was following the rules of CIS. That was up to the company. I’m also really confused about the ‘benefits’ of being self employed? He paid his taxes at 20% just like everyone else and has literally never claimed a single expense. Literally nothing. Even any training he did was paid for by the company and then deducted from his wages, the company then used it as a tax deduction on their tax return, not my husband. We pay both voluntary and involuntary (I think that’s what it’s called) NI contributions so as far as I know we have paid the same as everyone else. Last years bill was nearly £5k! I’m genuinely asking and not being arsey when I say I’d like for someone to explain how we benefitted from this arrangement? What benefits would he have been falsely claiming? It seems like his pay was on par with what he’d get from an employer like British Gas so it’s not like he earned loads more than other people who are employed. Anyway, we’re not going to HMRC, I have said that repeatedly.

@GreatBigHooAndToodaloo pleased you're feeling more positive today.
@Teenagehorrorbag is another poster who doesn't understand the difference between sub contracting and CIS .
With so many not understanding CIS it is easy to see how your DH's 'employer' sailed so close to the edge of the rules without being challenged by anyone.

Can I just comment on this.

It wasn’t up to him to make sure he was following the rules of CIS. That was up to the company.

By making a self assessment tax return you are, in effect, declaring everything to be correct. So I'm not sure he is off the hook, legally.

I’m also really confused about the ‘benefits’ of being self employed? He paid his taxes at 20% just like everyone else and has literally never claimed a single expense.

But isnt the tax rate variable, up to 45% for some?

@LizzieMacQueen

Can I just comment on this.

It wasn’t up to him to make sure he was following the rules of CIS. That was up to the company.

By making a self assessment tax return you are, in effect, declaring everything to be correct. So I'm not sure he is off the hook, legally.

I’m also really confused about the ‘benefits’ of being self employed? He paid his taxes at 20% just like everyone else and has literally never claimed a single expense.

But isnt the tax rate variable, up to 45% for some?

Yes, the very basis HMRC work on is that the customer is solely in charge of their own tax affairs. That is why when tax returns contain inaccuracies, the accountant cannot be blamed (they may be reported, but that's a different story). The OPs husband was fully aware he should be treated as an employee but continued to submit self-assessments as in the OPs own words 'the money was too good' to be honest about his affairs.

I do feel for those who find themselves working for tax-dodging employers. However, I reserve my sympathy for those who are on a low wage and have few other options but to suck it up. OP's husband was on an excellent wage by the sounds of it and stuck around for a decade. That is calculated and deliberate.

I also don't believe for a second the 'employer' was paying for expenses for her husband, then reimbursing himself from the husband's wages, then also claiming those expenses in his own tax return. There's not a chance he was the subject of a compliance check three years ago and that behaviour would go unnoticed.

Tough shit. He's clearly been a hidden employee but there won't be anyone around to chase about this.
In the meantime if your old man was in anyway half sharp he would have barely paid a penny in tax for the entire period..
If he'd had sense he'd have put aside 7% every week for holiday"pay" , put his tax return away every year as rainy day money..
Now I've just read that he didn't get an Self employed grant yet your claiming that he's been self employed for 10 years??
Something doesn't smell right....