Accepting freelance from company that laid me off

m0rgana

Hiya

So: I was made redundant a couple of weeks ago, and have been approached to do some freelance work by the (parent) company of where I had worked for two years previously.

I have not found any other work yet and this would be very well timed for me in terms of tiding me over while I search for a new permanent role - but I am wondering if this could in any way affect my redundancy package?

I was not required to work my notice so am on payment in lieu until the end of October. I have not yet received the payments owed to me (1 month + statutory) so obviously I am nervous about what accepting this work would mean.

I think it's most likely OK as long as I'm not re-hired as staff - can anyone confirm if that is correct?

many thanks

Prothet_of_Doom

m0rgana wrote: »

I was not required to work my notice so am on payment in lieu until the end of October. I have not yet received the payments owed to me (1 month + statutory) so obviously I am nervous about what accepting this work would mean.

So technically you couldn't sign on til November ?

Do you see Freelancing as the way forward, or a stop gap?

I'd suggest that you will want to be employed on PAYE via an Umbrellor company, (whereas I set up my own ltd company as I saw it as my long term plan), which means you will be working for another company that is supplying services, which happens to be the skills you have. Rather than being self employed you are working for another company.

I assume the terms of your redundancy allows you to obtain other empolyment during the period of pay. In any case it's not long until November so the paperwork might take that long.

My only worry, would be IR35, which specifically looks out for freelancers who were previously employed by the same company. The company might be a different legal entity, but the HMRC might not see it that way. Not that you can't work for them as a freelancer, but you might need to discuss with a professional how you pay the correct tax and NIC, (which is probably via PAYE via an umbrellor....)

but I'm not qualified, just someone that freelances, and has done a little research.

scheming_gypsy

Ask the company if it'll affect your redundancy pay out, as it'll be them pulling it if it does.
But i'm come across quite a few people who have been made redundant and then gone straight in as contractors to the same company.

m0rgana

Prothet_of_Doom wrote: »

So technically you couldn't sign on til November ?

Not sure, but I'm guessing not.

Do you see Freelancing as the way forward, or a stop gap?

At this stage it could really be either; I strongly suspect I'll be going self employed at least in the medium term because it seems to be the way the market's going, but this particular role will probably be stopgap.

I don't have the full details yet, but it's likely to be temporary, which is why I doubt I could make it PAYE.

I assume the terms of your redundancy allows you to obtain other empolyment during the period of pay. In any case it's not long until November so the paperwork might take that long.

They were vague enough terms that this was not even mentioned. I don't know if that means that by default I can or can't...

My only worry, would be IR35, which specifically looks out for freelancers who were previously employed by the same company. The company might be a different legal entity, but the HMRC might not see it that way. Not that you can't work for them as a freelancer, but you might need to discuss with a professional how you pay the correct tax and NIC, (which is probably via PAYE via an umbrellor....)

Thanks - that's worth knowing about. But would this only apply until November?

brightonman123

wait for your payoff money first, then overcharge the parent company for any new work you do.

karma!

getmore4less

When was the termination date?

leave a gap only a week(sat-sat) is needed but as said get paid first.

no need for an umbrella that just cost money self employed is fine unless the company want to distance you.

Tigsteroonie

You (& the company involved) will need to consider whether you are genuinely self-employed, or actually an 'employee in all but name'.

This page of the HMRC guidelines explains: http://www.hmrc.gov.uk/employment-status/index.htm

m0rgana

Tigsteroonie wrote: »

You (& the company involved) will need to consider whether you are genuinely self-employed, or actually an 'employee in all but name'.

This page of the HMRC guidelines explains: http://www.hmrc.gov.uk/employment-status/index.htm

Sure - but to be clear this is probably going to be a two-week stint of working from home. It's freelance.

Prothet_of_Doom

getmore4less wrote: »

When was the termination date?

leave a gap only a week(sat-sat) is needed but as said get paid first.

no need for an umbrella that just cost money self employed is fine unless the company want to distance you.

I'm yet to find a freelance contract that would deal with an individual and all have insisted that you are either ltd, or go through an umbrellor.