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5th December 2008: Part 4 of Determining Employment Status "Substitution"
All the installments of Determining Employment Status are here:
Determining Employment Status Part 1 "The Right of Control"
Determining Employment Status Part 2 "Financial Risk and Reward"
Determining Employment Status Part 3 "Mutuality of Obligation"
Determining Employment Status Part 4 "Substitution"
Substitution
So we've reached part 4 of our series on determining self employment, and today we'll be talking about the right of Substitution or just Substitution, the right to send someone to work in your place, or use a helper to assist in the complettion of your work.
Substitution is arguably the hottest factor of the 4 as historically it has the appearance of being so cut and dried; if you don't have the right to substitute, how can you be self employed, and if you do, how can you not be?
There is no doubt that Substitution is a very important factor, but as with all the the other factors it can only really add weight to one side of the argument, it's not the definitive victory that people hope it to be. Some assignments may not allow for substitution for a variety of reasons, programmers working on secret government projects, quite often don't have that option (even if they did contractually how would they exercise that right practically), but that doesn't mean they are employees all of a sudden.
On the other hand you have people with the right of substitution that never exercise that right. This is increasingly becoming a popular line of attack for inspectors from HMRC, if they can prove that the contractual right of substitution doesn't reflect the circumstances on the site itself it can add a lot of weight to any argument they may have for proving of employment.
Both parties you the contractor and they the client, need to accept that the right of substitution isn't just something drawn into a contract it is something that reflects your true status as a self employed contractor.
That's all for now, I hope you all have great weekends, and hopefully I'll have something for you on Monday
Hugo
05/12/2008
