Correct way to have self employed staff

[vince]

Hello,
I am sure this is covered in here but I am getting confused and find conflicting infomation on the web in general.We would like to get it right if theres any trouble tax wise in the future
We have a small beauty salon with myself and partner with 1 self employed beauty therapist and 1 self employed hairdresser.We havnt had it too long and were trying to get everything covered.We have a great little team,and everything is working well but I have a few questions.
Is there a standard(ish) self employment form I can download from somewhere to cover all/most/general bases or failing that what sort of wording needs to be in a s/emp contract(just a good basic type document would be fine)
We feel they are both truley self employed as we dodnt tell them when they can and cannot leave,if they want a day off,have it.Oviously if they want too make money then they need to be there and everyone communicates so it works well for us all.
We have been told we are probably on thin ice as my partner takes or handles all the money from everyones jobs and then she pays them on a sat minus the percentage we charge them.We do this really because its easier that only one person is handling the money/till and everything is entered in to a central book which all can veiw to see what jobs they have done/got coming up and have made.They do there own self employed tax returns.
Should they be handling there own money and giving us the percentage ie the other way around) to satisfy HMRC?
With the hairdresser we supply nothing at all apart from the orignal set up of backwash chair ect.He supplys all his own products,and has no other bills.He pays us 30%
With the beauty therapist we supply everything,products,tools,equipment,she pays 45%
Should she be suppling her own tools/products? again to satisfy HMRC.
The way we do it now suits us all,not that we are control freaks.
If the way where doing it now is wrong or could land us in hot water we will happily let them take there own money,supply there own tools ect but would rather find now and change it now rather than later if HMRC ever got involved.
Any help or advice would be greatly appreciated as the more I read on the pitfalls of self employed staff the more confused I get.
All the best and many thanks in advance
Vince

 

[ttaylor]

I'm a self employed hairdresser and as far as I'm aware I have to take my own money and have a little cash box and I have my own appointment book, this wasn't always the case in the previous salon I worked in. But have been told it is best to be as independent as possible. As for supplying and doing % split or full rent im not too sure I pay a flat rent and supply everything but backwash my self. Keeps it simple hope this helps. X

 

[Megdav87]

I'm a self employed therapist in a salon and the owner supplies all equipment products etc. I am given my money weekly minus the percentage I give her.
It works really well and their are 4 hairdressers in our salon which do the same and have done for years.
As far as I'm aware there is no problem doing it the way your doing it.

 

['chelle]

Before I was a nail tech I was a legal executive working in employment law for many years. You have to be extremely careful with this, because even if your "staff" have self employment contracts, if you have certain practices at the salon an Employment Tribunal could still declare that your staff are actually in employment (thats if any staff decided to take you to ET for whatever reason.) For example, if you set the workers working hours (which you have said you do not) the ET can infer a contract of employment, and there are many more things that can lead to this like for example who provides the products, what is the basis for payment etc. It is a very complicated area, and like I said, just having a contract of self employment doesnt mean you are covered and that your staff are definitely self employed. The best and only thing you can do is to book yourself an appointment with an employment law solicitor who will be able to draw up a contract for you, and give you guidance on paying staff, buying products, setting working hours and holidays etc etc. Yes its expensive, but nowhere near as expensive as an employment tribunal case where you might have to pay out compensation.

Personally, I am self employed. I pay £50 per week for my room in a hairdressers. I decide on my own hours of work, these are not dictated by the salon owner at all. I buy all my own products, I dont get any holiday pay, I take payment from my own customers and pay the salon owner her rent at the end of the week. I am responsible for all my own advertising and for finding my own clients. The client base I have belongs to me, not the salon, and if I ever decided to leave that salon I can take my client records with me.

 

[ssuk]

Im afraid its not a simple as you believing they are self employed. I would speak to HMRC and check there status first. It can be a nightmare. And they could appear clearly to be self employed, yet still be employed on a technicality.
Can they pick there own hours, wear what they want, use own equipment, cancil clients and take day off if feel like it, get someone to come in and work for them instead?

There are loads of things to be careful of, and that one call to check could save you a small fortune one day.Wouldn't want to see you get stung.

 

[vince]

Hi,
Many thanks to all of you have taken the trouble to reply.
All very helpful.I think we will have to make a few minor changes because as it has been said A minor technacality could turn everyone employed rather than self employed causing a big expensive headache.
I will contact HMRC for guidence but Its still a fairly large grey area from what I have managed to find on there website.
Thank you all again.

Vince

 

[vince]

Hello,
Much helpful advice so far
re my original post.If we stopping taking the money from our self employed staff and everyone has there own cash box,at the end of the week do we invoice our staff for the percentage of there take ie they tell us they took £100 so we invoice them for £45.(its a 45/55 split) and everyone runs there own payment/earnings book but we will run a central reservations book for ease.
Hopefully with some small tweeks all will satisfy HMRC if they ever get involved.
Thanks again
Vince

 

[gillyxx]

I am a self employed nail tech working in a salon. The salon owner has provided me with a work station and i supply all my own equipment and products etc. I have agreed with the salon owner to split my takings 50/50 until i build my client base up and then when the time comes i pay the salon a set price per week for rent. I use the salon's appointment system and their central till etc. I then get my share of 50% at the end of each week.
I am more than happy with this set up, and i don't have any problems at all. I also have my own hours, holidays etc.
I know not everyone is as happy but hope this helps you a little.

 

[jojo@tranquil]

I have a salon and I employ 1 part time therapist and then have various self employed people coming in offering more expensive treatments such as teeth whitening, Botox, semi permanent make up etc, up until now the clients payed the salon and then the freelancers would invoice me for there percentage which is usually a lot more than my share eg 3 areas of Botox £300.00 I get £20 per area so basically £60.00 for 30 min slot in my room.
However I am beginning to get concerned that my turnover is being pushed up by large payments going through and I don't really want to be liable to pay the VAT man 20 % ! So I am now going to get the client to pay the therapist and then I will invoice them. Just to keep turnover down.