Am I employed or self employed?

MeganLloyd

New Member
I have been working in a salon since August. I’m told I am self employed. The owner takes 55% of all my profits and she provides everything. I am told to work on a Friday 10-7 and be in the salon regardless if I have appointments and stay all day. I’ve been given the choice to leave in the past but last week she pulled me and said she wants me there all day. I am paid at the end of each month. My clients pay through her card machine and cash goes in her till, she takes all the money and pays me on a certain date. My appointments are through her system and other people in the salon can book in appointments with me when I’m not there. I’m expected to help out around the salon whilst I’m there like cleaning, washing up, answering the phone etc. I’ve spoken to HMRC today and they have classed me as employed. Could I have some advice? I’ve asked for a contract and it doesn’t exist. I’ve asked for our agreement in writing and apparently it’s all verbal because I’m self employed. Has anyone had a similar experience? What next steps should I take? Thanks
 

CFBS

Well-Known Member
I would say that you are working there on an employed basis with all those conditions!
 

Ruby S

Active Member
You are definitely employed and she risks being investigated by HMRC.. if you are self employed she cannot dictate your hours, take your money for you, advertise for you etc... she really needs to do research on this.
 

Ruby S

Active Member
I would print off some info from the HMRC website and get her to realise that you need to be a completely self contained business OR she needs to get you the books and start paying your tax and NI and pension etc.... x
 

MeganLloyd

New Member
Thanks guys for your help. Does anyone know if this means I am owed the minimum wage for the hours I have been there with no clients in? Thanks
 

Ruby S

Active Member
Thanks guys for your help. Does anyone know if this means I am owed the minimum wage for the hours I have been there with no clients in? Thanks
Ooh no idea... this is a conversation to have with HMRC I think but she is definitely at risk if you draw attention to her business, so be aware of that. She is acting wrong but also may not be doing it knowingly, so I would call a meeting with her to discuss, especially if you have a good relationship... there is a sticky thread about this at the top of the business forum x
 

Marzie

Member
Hi contact acas and they will give you free advice. You will be due holiday pay etc and they will give advice on how to approach your employer. You are employed. Please let us know how you get on x
 

salonfrog

Accountant for salon owners
I would say you are self employed, largely because you cannot chose your own hours.

Have a go at the HMRC CEST tool as they say they will stand by it (it asks questions and decides whether you are employed or self employed).

 

taza87

New Member
Do you market yourself as a business operating out of the salon, or are you part of her team? If you were unable to work, would she allow you to send in a trusted professional in your place to take over your duties? This is the important caveat - if your are allowed to provide a substitute to cover your duties, you're self employed, if she wouldn't accept a substitute, you are employed.

From what you've described you are most likely a contractor, so self employed. Essentially you are renting a space on a commission deal. If she won't provide a contract, write one yourself, after all you are providing a service to her. However you seem to have slipped into the grey area or what I like to call the Uber Paradox.

I'm a business student and as part of that we did employment law. Check if she is paying your contributions, if not get on this straight away, you need to start paying your class 2 NIC or it affects your state pension.

Basically, she is calling you self employed so she doesn't have to deal with the tax / legislation side of things, but treating you as an employed person. I am NOT a law professional, but if she is not paying your NIC and not accepting substitutes, she is acting unlawfully. If she really wants you to be self employed and you are happy to commit to certain hours and duties then write up a contract for services provided as a contractor and tell her to sign it or you're walking.

Also 55% sounds a bit high to me!
 
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taza87

New Member
P.S. Please make sure you are documenting the services you provide and check the amount of money she is giving you. I don't know this woman, but it's likely if you haven't been paying full attention, she has been skimming your money!
 

Haircutz

Super Moderator
Staff member
Firstly, I’d be looking for somewhere new to work properly self employed. Make sure you have all your clients records so you can let them know you’ve moved. (I’m guessing she doesn’t let you keep your client record cards?)

Secondly, report her to HMRC so they can investigate. If they decide it’s a sham employment arrangement, she will be forced to repay you outstanding minimum wages, holiday pay etc.
 

MeganLloyd

New Member
Okay so I spoke to HMRC already and they confirmed I was employed but being treated as self employed. They said they would back me on that. I spoke to the national minimum wage people and they told me to speak to her and if it becomes an issue to get back in touch. I text her last night explaining the situation in a polite way and asked her to look into it for me and she said she would. I’d like to think she doesn’t know what she’s doing but it’s hard to believe. HMRC said I’d be entitled for my pay to be back dated for the minimum wage for the hours I was in the salon.
Thanks so much for your help guys
 

salonfrog

Accountant for salon owners
Do you market yourself as a business operating out of the salon, or are you part of her team? If you were unable to work, would she allow you to send in a trusted professional in your place to take over your duties? This is the important caveat - if your are allowed to provide a substitute to cover your duties, you're self employed, if she wouldn't accept a substitute, you are employed.

From what you've described you are most likely a contractor, so self employed. Essentially you are renting a space on a commission deal. If she won't provide a contract, write one yourself, after all you are providing a service to her. However you seem to have slipped into the grey area or what I like to call the Uber Paradox.

I'm a business student and as part of that we did employment law. Check if she is paying your contributions, if not get on this straight away, you need to start paying your class 2 NIC or it affects your state pension.

Basically, she is calling you self employed so she doesn't have to deal with the tax / legislation side of things, but treating you as an employed person. I am NOT a law professional, but if she is not paying your NIC and not accepting substitutes, she is acting unlawfully. If she really wants you to be self employed and you are happy to commit to certain hours and duties then write up a contract for services provided as a contractor and tell her to sign it or you're walking.

Also 55% sounds a bit high to me!
Good post but I would go through the CEST tool as some of these points have changed quite a bit recently.
 

MeganLloyd

New Member
She has got rid of me!!
 

BannerPenguin

Well-Known Member
She has got rid of me!!
Well if she realized you are actually employed and she was gonna have to pay you minimum wage then I'm not surprised. With all due respect, you expected this, right?

It's just up to you to chase her now for wages owed but it sounds like you can expect a fight.
 

Haircutz

Super Moderator
Staff member
It's just up to you to chase her now for wages owed but it sounds like you can expect a fight.
I’d let HMRC deal with it. They’re likely to fine the salon owner as well as work out any outstanding wages owed.
At least she’s unlikely to try it on with the next person she takes on.
 
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