Forced from Employed to Self Employed

Mrcurious82

I'm desperate for some simple advice on a Matter where my employer (Whom i have been with for 15 years) has now told me that i have to go Self Employed. Do i have any rights in this situation as I really don't want to go Self Employed, its worrying me sick. I will be doing the same Job for the same money. They have said it will put more money in my account as i won't have to pay so much tax but i feel it's because it stops them having to pay my pension contribution and National Insurance. They have already taken away my Private Health Insurance 2 months ago and this looks like the next step. Any help with this matter is greatly appreciated.

SiliconChip

It is very unlikely that a job that has been employment for 15 years can legitimately become self employed, as you suspect they are doing this to try to get out of some of their employer obligations and save money. If you feel you can't force them to change their mind and retain you as an employee you may need to find another job. It's possible that you could have a claim for constructive dismissal, other posters with greater knowledge of the legal position may be able to say more about this, but be warned that it can be very difficult to prove. You may also discover that their cost cutting measures are a sign that the business is going under.

https://www.gov.uk/dismissal/unfair-and-constructive-dismissal

Undervalued

SiliconChip said:

It is very unlikely that a job that has been employment for 15 years can legitimately become self employed, as you suspect they are doing this to try to get out of some of their employer obligations and save money. If you feel you can't force them to change their mind and retain you as an employee you may need to find another job. It's possible that you could have a claim for constructive dismissal, other posters with greater knowledge of the legal position may be able to say more about this, but be warned that it can be very difficult to prove. You may also discover that their cost cutting measures are a sign that the business is going under.

https://www.gov.uk/dismissal/unfair-and-constructive-dismissal

If the OP can't persuade the employer to change their mind then it would be far better to wait for the employer to dismiss them (if they do) then claim unfair dismissal. Constructive dismissal is, as you say, very hard to prove and less than 3% of such cases are won at an employment tribunal.

On the face if it, if dismissed, then a straightforward unfair dismissal claim would be far easier.

However, keep in mind that a tribunal can only award some compensation (generally far less than most people expect) and cannot force the employer to take the ex-employee back on the original terms.

SecondRow

SiliconChip said:

It is very unlikely that a job that has been employment for 15 years can legitimately become self employed, as you suspect they are doing this to try to get out of some of their employer obligations and save money. If you feel you can't force them to change their mind and retain you as an employee you may need to find another job. It's possible that you could have a claim for constructive dismissal, other posters with greater knowledge of the legal position may be able to say more about this, but be warned that it can be very difficult to prove. You may also discover that their cost cutting measures are a sign that the business is going under.

https://www.gov.uk/dismissal/unfair-and-constructive-dismissal

It’s not constructive dismissal - the OP is still there and considering options, so still a mile short of that at this stage.

Marcon

Mrcurious82 said:

I'm desperate for some simple advice on a Matter where my employer (Whom i have been with for 15 years) has now told me that i have to go Self Employed. Do i have any rights in this situation as I really don't want to go Self Employed, its worrying me sick. 

Yes. You have the right to say no - and ask the employer what has changed such that HMRC would agree you have suddenly become self employed. If you are sacked as a result, then the chances of that dismissal being 'fair' are pretty slim.

Mrcurious82 said:

They have said it will put more money in my account as i won't have to pay so much tax but i feel it's because it stops them having to pay my pension contribution and National Insurance. They have already taken away my Private Health Insurance 2 months ago and this looks like the next step. Any help with this matter is greatly appreciated.

Rubbish. Your tax won't change and you'll have to pay your own NI, so it'll cost you more. You will also lose out on pensions, paid holidays, etc.

Mrcurious82

Thank You everyone for your contributions it's much appreciated.

Grumpy_chap

Mrcurious82 said:

I'm desperate for some simple advice on a Matter where my employer (Whom i have been with for 15 years) has now told me that i have to go Self Employed. Do i have any rights in this situation as I really don't want to go Self Employed, its worrying me sick. I will be doing the same Job for the same money. They have said it will put more money in my account as i won't have to pay so much tax but i feel it's because it stops them having to pay my pension contribution and National Insurance. They have already taken away my Private Health Insurance 2 months ago and this looks like the next step. Any help with this matter is greatly appreciated.

Before you can become "self employed", how does the employer propose that your current employment contract is ended?
I assume you will not resign, so that leaves redundancy (with the appropriate compensation that would attract) or dismissal.

It may be possible that there is a business need to outsource certain functions and that may mean that a genuine redundancy situation can be so.

IF you are made redundant, then options around working as a "self employed" contractor for the same firm can be considered.  The employer will likely need to undertake an IR35 determination first.  This may restrict how you can be engaged as "self employed".

I note you say they withdrew private health cover recently.  How do you feel the company is faring in terms of work load and financial strength?  If this is all the slippery slope of a company that is struggling, you may feel the need to look for employment elsewhere and it may be better to take things into your own hands rather than await the inevitable.  Of course, the company may just be hoping that enough people reach that conclusion and leave that they can avoid redundancy costs.

penners324

Sounds like you wouldn't be deemed s self employed by hmrc anyway. Look up IR35 regulations.

Employer is trying to cut costs, no holiday pay, no pension, no sick pay, no redundancy entitlement. 

penners324

You'd need a large payrise to counter all of that, like 50% +

caprikid1

I think it depends very much on the role. 

I recently had some carpets fitted, the carpet fitters were paid directly by me, the contract in theory was with me.

I suspect previously they were employed by the carpet shop.

It could be possible to be changed to a self employed role. I could see the same with Window fitters etc done carefully.

The government has a great tool you and your company can use.

Check employment status for tax - GOV.UK (www.gov.uk)

Very quick and easy but will tell you whether what they are proposing is actually legal.

I guess you need to think about what you want and the likely outcome as opposed to the current legality of what they are going.

IE
Stay as you are (An option ?)
Leave
Get made Redundant
Resign
Managed out ?
.

Hoenir

caprikid1 said:

I recently had some carpets fitted, the carpet fitters were paid directly by me, the contract in theory was with me.

I suspect previously they were employed by the carpet shop.

That seems perfectly reasonable. As they only get paid when there's a job to do. They are responsible for their own equipment and insurance etc. In addition they are free to work for who else they please.  A situation which works well for all concerned. Particularly if work through the shop you purchased from is erratic.