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May 2013

Home cleaner – self-employed or employee

With longer working hours becoming ordinary it is increasingly common for people to hire help around the house. Despite how casual the arrangement might be, it is advisable to establish if they are your employee or if they are self employed.

This is important as if they are your employee, you should be accountable for ensuring they are paying the right amount of tax and NI.

Hired help could be judged to be your employee if;
• You dictate what hours they work
• They have to do the work personally – they can’t send someone else
• They work set hours and days in the week
• They get paid even when you don’t need them – for example holidays

If you feel that your hired help does fulfil these requirements, then they are your employee. As such they will be entitled to at least the National Minimum Wage and following on from the recent payroll changes, you will need to report their earnings to HMRC via the new RTI system. They will also be entitled to statutory rights for example; unfair dismissal, redundancy and holiday pay.

This may seem like a lot of extra stress, and therefore there are ways of ensuring their self employed status giving them responsibility for their earnings. If they decide when they can work and provide their own tools for the job, it would be easy to justify they are self-employed. You should also set up a fixed fee arrangement rather than an hourly rate, as this shows they can make a profit or a loss which is another indicator of self-employment status.

You could hire someone via an agency, although you would be paying more, there is the flexibility in regards of the people – easier to change someone should you feel the standard of work is not statutory.

If you would like any further information on this, please don’t hesitate in contacting us on either 02476 518 555 or 0121 711 2468.