Working as self employed...

[OfUselessBooks]

I am in the process of applying for a job. I was made redundant due to covid and jobs in my profession are very few and far between, especially part time and in my local area.

I strongly suspect they are about to offer to me on a self employed basis. I understand the law on this and know it's wrong (the nature of the job means that they set the work, location, hours (although there would be some flexibility) and pay, I can't send anyone else and I do their work on their equipment). I know the negatives - no holiday, maternity, pension, sick pay, employment rights. I'm usually the sort of person that feels very strongly about this sort of thing, both for myself, and when I was a manager, by ensuring I treated my staff fairly and according to the law.

However...

There are no jobs in my field at the moment. I was shocked to see this one advertised. In the 4 months I've been job hunting nothing else has been advertised. The alternative seems to be to just continue to deplete our savings, which could last another 18 months, although during that time we would become entitled to benefits.

It hasnt happened yet, but I'm naturally a worrier and like to plan what to do. I may be able to get a low paid admin job instead, but even that seems a struggle at the moment and I have limited experience, although some transferable skills.

I never thought I would be in this position...what would you do? Is there a way to gently point out what they are doing wrong? What are the implications of using the job as a stepping stone to avoid using our savings until something else comes along? I'm normally the one to stick up for employment rights, but potentially turning this down could be cutting off my nose to spite my face if I don't find something else quickly...

Not in the UK but I work on a similar basis, I work for a company who set the hours, the work, it must be me who does it ect. I am treated as a normal employee apart from the fact I have no employment rights and no leave or sick pay rights.
Its not ideal particularly the lack of leave or sick pay as if I want to take days off etc I have to account for how much I will loose for the missed days.
I was pretty desperate when I took the Job but despite the annoyances I don't regret it. There where no other jobs in my industry available at the time and this was better than no income at all. Will you enjoy the job? I love my work which makes the situation easier and as a result i've decided I will stick this out for the 2 year contract and then try to negotiate full employee status or a rise to cover lack of sick pay, leave pay etc. If they refuse then I will look elsewhere.
I would honestly say take it, you're not tied to them forever and you can keep your eye out for something better

It would be illegal to work on a “self employed” basis when it is clearly employment. However could you set up a Ltd company, have a contract for services with them but then pay yourself a salary from the Ltd company. That would work up until April 2021 when the IR 35 changes would mean they have to employ you directly.

Thank you for the replies. I think I'd enjoy it and it would be a good job. I'm hoping they will realise this and offer a proper contract. Could I get into trouble, or would it just be the employers who could?

I think if this is the only thing on offer, then i would probably have to use it as a stepping stone until something else came along, in the full knowledge that I had very few rights and no benefits. Earning £300 or so a week temporarily under these circumstances is better than being on jobseekers!

Could I get into trouble, or would it just be the employers that would

HMRC would certainly be more interested in the employer than you. However you wouldn’t come out unscathed, especially if you try to claim expenses - the self employed have more scope to claim for expenses than an employee does. Also you are likely to have underpaid national insurance contributions.

@Florencex

Could I get into trouble, or would it just be the employers that would

HMRC would certainly be more interested in the employer than you. However you wouldn’t come out unscathed, especially if you try to claim expenses - the self employed have more scope to claim for expenses than an employee does. Also you are likely to have underpaid national insurance contributions.

That said, if you weren't aware of your situation - and I'm sure it would be easy to not be aware- then you would have legal claims against the employer. Probably quite a few of them. After all, if your employer yells you it's all legal, then who are you to know differently. Provide you keep an eye on timescales etc, then you would have potential tribunal claims, or civil claims for losses if you were pursued for underpayments. I'm not excusing the employer at all, and they shouldn't even be thinking about this, but needs must and you need the job. But I'd equally be having no qualms about taking them to the cleaners later if needed. What goes around comes around.

As long as you register for tax and national insurance as self employed and keep proper records, eg give your employer invoices then you're fine. They are manipulating the system to save themselves money which I find morally wrong but it's how I worked for 4 years before this job

Not fully up to date on UK law but I imagine its something similar to here. I have a registered limited company, each month I invoice my employer and then I pay myself a salary from my Ltd company, take expenses, pay my own tax and keep accounts. It does actually add up to quite a lot of work for me to do it this way so if you'd need to do the same that is something worth considering

You may as well take the limited company route for the time being. Costs are small and it has an natural end point of next April, you'll either have a new job by then or they will have to employ you.

@Littleposh

As long as you register for tax and national insurance as self employed and keep proper records, eg give your employer invoices then you're fine. They are manipulating the system to save themselves money which I find morally wrong but it's how I worked for 4 years before this job

No this is definitely not fine as explained above.

That you did it for four years does not make it fine.

That would work up until April 2021 when the IR 35 changes would mean they have to employ you directly.

IR35 has been around for years already. The only changes in 2021 are that the employer would then make the decision (and have the liability) on whether the role is one of an “employee” or not (inside or outside ir35). At the moment it would be your decision and liability, as they’re complex rules I’d recommend getting specialist advice on the contract and working conditions (you’d want to avoid any control, mutuality of obligation, have a substitute clause, etc) before setting up a limited company. From what you’ve said (they control hours, work, equipment, etc) you sound like you’d be “inside ir35” unless you can negotiate around this. I’d recommend using an umbrella company to start with if this is the case as a safe way to contract inside ir35. Good luck whatever you do.