Choice between employed or self employed

EmmaJ07

Hi everyone,

I started a job recently. It is part time cleaning roughly 6 hours a week on average.
We have been given the choice of being employed at £8.25 an hour or self employed at £12 an hour.
I am not sure which is the best option and even after doing research I'm still struggling.
There are people who clean for the company already who are employed so my concern would be would they use them first/only ask self employed people to work if the employed ones couldn't?
Otherwise the larger pay makes it seem a very enticing option.
If anyone has any experience of this or help/advice it would be greatly appreciated.

Thanks.

BakingC

Find out the other differences rather than pay. If you are self employed do you have to supply your own cleaning things and the company will not reimburse, what about travel?

Do you have to wear a specific uniform regardless of employed vs self employed?

If you are self employed you would most likely not get paid holidays, employer pension etc this are all things to consider which would make up for the pay difference.

If you are self employed you will have to sort out your own taxes / NIC if you are employed they should do this via the pay cycles they run for their employees but due to the amounts you are earning unless you have other employment you will likely fall under the personnel allowance threshold anyway.

ReadingTim

The difference in pay is to compensate for the things you won't get if you're self employed, such as sick pay, holiday pay, pension, someone doing your taxes & NICs and submitting them to HMRC, etc.

If you were self employed in any other jobs you have (I see this is only part time), then I'd probably go SE on this one too. If you're not, and given it is only part time, the additional hassle and potential cost of sorting stuff out for yourself (or paying someone else to do it), I would suggest it's not worth the effort, so would go down the employee route to keep things nice and simple.

agrinnall

What is the basis for allowing a choice to be made? The facts are what determines whether it is employment or self-employment, and in most cases the facts are clearly one or the other so no choice is possible.

ReadingTim

agrinnall wrote: »

What is the basis for allowing a choice to be made? The facts are what determines whether it is employment or self-employment, and in most cases the facts are clearly one or the other so no choice is possible.

Errrr..the fact that the OP says it's about 6 hours a week?!?

EmmaJ07

Thanks for the advice everyone, there isn't a uniform and all equipment is provided so there isn't any difference there. With me only averaging 6 hours a week I didn't think I would get much holiday pay/not as much as I could make being self employed? It does feel strange being given the choice. They are quite a new/small company so not sure they know what they are doing : /

jonnygee2

There are people who clean for the company already who are employed so my concern would be would they use them first/only ask self employed people to work if the employed ones couldn't?

This is about the number of hours on the contract. It doesn't matter if it's an employment contract or not for this, either could be fixed hour, or zero hours.

We have been given the choice of being employed at £8.25 an hour or self employed at £12 an hour.

If this is your only income then I think you are probably better off with the self employment option. You will earn more overall, even when you take out 4 weeks worth of holiday entitlement and pension contribution, assuming that these are statutory minimums.

sangie595

ReadingTim wrote: »

Errrr..the fact that the OP says it's about 6 hours a week?!?

The number of hours is, however, not one of the tests! You can be an employee working 30 minutes a week, or self-employed working 56 hours a week. Agrinnall is correct - the facts of the circumstances determine this, and it isn't a choice. The OP needs to explain whether they are able to send someone else to do the work and do whatever hours they wish. If the hirer controls key choices like that, then they are an employee and there is no choice.

I'd be asking serious questions about the nature of any employer who thinks it's a choice!

jonnygee2

The number of hours is, however, not one of the tests! You can be an employee working 30 minutes a week, or self-employed working 56 hours a week. Agrinnall is correct - the facts of the circumstances determine this, and it isn't a choice. The OP needs to explain whether they are able to send someone else to do the work and do whatever hours they wish. If the hirer controls key choices like that, then they are an employee and there is no choice.

I'd be asking serious questions about the nature of any employer who thinks it's a choice!

While, legally speaking, you are completely correct, this is far from an abnormal proposition in the UK labour market.

Morally and legally questionable yes, but I don't think the best advice to the OP is to try and take this on.

EmmaJ07

We are allowed to turn down hours and the self employed girls don't have to send someone to cover them, they just dont turn up! I don't get a pension so I'm thinking I may be better going self employed as it's demoralising at the moment getting £3.75 an hour less than the person I'm working with : /

jonnygee2

We are allowed to turn down hours and the self employed girls don't have to send someone to cover them, they just dont turn up!

I guess the question is, is there a minimum number of hours specified that they will give you, either in the employment contract or the freelance contract? If so, are the two different? I suspect they are both 0, so actually they are the same?

One thing you will definitely lose is your holiday entitlement. When you are employed you must get at least 21 days paid holiday. I think this usually works out about 12% or so, so the employed contract is probably worth closer to £10 / hour.

If it's your only income you won't get any tax or statutory pension contributions. Employees do also have slightly more theoretical rights, but then again, not really!

So, I agree with you, £12 / hour self employed is a better choice.