4 ms·

English law recognises that there is a continuum between obviously employed and obviously self-employed, but the categorisation in any particular case will be d

by pmyteh 10y ago

English law recognises that there is a continuum between obviously employed and obviously self-employed, but the categorisation in any particular case will be down to the reality of the actual relationship between the employer/contracting company and its staff/contractors. There's no bright line, edge cases are ruled on case-by-case in the tribunal, as here. The actual criteria are pretty complicated - see the guidance manual at https://www.gov.uk/hmrc-internal-manuals/employment-status-manual/esm0500 https://www.gov.uk/hmrc-internal-manuals/employment-status-m... - but the essence of it is control ("does the boss have the right to tell the worker what, where, when and how to work?"), personal service/substitutability ("can the worker send someone else to do the job, instead of doing it himself?"), risk ("who is on the hook if something goes wrong?") and some other factors. Very fact-specific. Incidentally, one of the standard features of traditional taxi drivers in the UK is that they don't set their fares, that being the responsibility of the local government. Uber drivers are licensed in the separate category of 'private hire', which has less stringent licensing (and the right for a firm to set its own fares) but a prohibition on picking up passengers by being hailed, and some other restrictions.

vog 10y ago
> English law recognises that there is a continuum between obviously employed and obviously self-employed Very similar here in Germany, I guess. There is the term "Scheinselbstständig", which roughly translates to "fake self-employed". If you are formally self-employed but meet certain criteria, your "customer" (who is then considered to be more your employer than a customer) has certain obligations to you, and you have certain rights, which you can't easily trade away.
- lgieron 10y ago
  In the UK (and also in, for example, Poland) self-employed people pay much lower taxes than the employees - hence we're all very happy to trade away our rights.
  - gaius 10y ago
    But that has a social impact. You might be chuckling to yourself over how much NI you're not paying, but if you are injured the NHS will still treat you, and the money has to come from somewhere.
  - infinite8s 10y ago
    That's interesting, in the US it is the opposite, although you might be able to write off certain things as expenses so your overall taxable income is lower.
  - rwmj 10y ago
    I believe you are thinking of people who set up companies and pay themselves through dividends (which have a much lower tax rate), which is now (highly controversially) illegal -- search for "IR35". Ordinary self-employed people and sole traders pay nearly the same tax rates as employed people (National Insurance, a strange disguised tax, is at a different rate), but have many fewer rights, eg. no right to paid time off or sick pay. The question in this case is whether Uber drivers are self-employed or not. Not as it turns out.
    - nvarsj 10y ago
      > pay themselves through dividends (which have a much lower tax rate), which is now (highly controversially) illegal What on earth are you talking about... taking out dividends is not illegal, even for individual company owners. IR35 is about HMRC forcing self employed people to apply payroll taxes as if they were employed. Again, nothing to do with dividends.
- rb2k_ 10y ago
  I was "self-employed" ("Freiberufler") and working for a US startup 100% of my billable hours. They hadn't formed a company in Germany at that point, so I just send them a bill and paid the employer and employee part of my health insurance. I got some letters about that and they asked me to prove that I was indeed self-employed. They didn't like the argument and concluded that I wasn't. The only thing that actually happened after a while is that I had to pay into the public retirement fund against my will. The "Deutsche Rentenversicherung" are seemingly the only people that care. From what I can tell there were no other obligations/rights that appeared after.
  - detaro 10y ago
    I'm not a lawyer, but what I remember from talking with self-employed family members: There are different parts of German law/government that are affected, retirement is only one of them (and just because one authority noticed/thinks you qualify doesn't automatically mean that the others do). Tax avoidance (since payroll taxes on your salary weren't paid) is another angle. For the employer, not paying their part in your social security contributions is similar to not paying you your full salary, and thus a criminal matter as well.
jasode 10y ago
>English law recognises that there is a continuum [...] There's no bright line, edge cases are ruled on case-by-case in the tribunal, Sure, I understand that. USA law is fuzzy in the same way. (The IRS 20 rules[1] are guidelines and not binary true false criteria usable for perfect machine learning classification.) But for the sake of discussion purposes on HN, I'd like for you or anyone to play the role of general counsel for Uber and say exactly and concretely what they would need to do. [1]https://www.google.com/search?q=irs+20+rules https://www.google.com/search?q=irs+20+rules
- pmyteh 10y ago
  I'm not a lawyer; my exposure to employment law came in a previous existence as a workplace union rep and this is somewhat outside my expertise. As I understand it, if the Uber driver were allowed to have someone else drive their car for Uber when they felt like it, and had the freedom (actual, not nominal) to decide which clients they'd like to take on, and had control of their pricing, then there would be no question it was actual self-employment.

by pmyteh 10y ago

vog 10y ago

> English law recognises that there is a continuum between obviously employed and obviously self-employed Very similar here in Germany, I guess. There is the term "Scheinselbstständig", which roughly translates to "fake self-employed". If you are formally self-employed but meet certain criteria, your "customer" (who is then considered to be more your employer than a customer) has certain obligations to you, and you have certain rights, which you can't easily trade away.

lgieron 10y ago
In the UK (and also in, for example, Poland) self-employed people pay much lower taxes than the employees - hence we're all very happy to trade away our rights.
- gaius 10y ago
  But that has a social impact. You might be chuckling to yourself over how much NI you're not paying, but if you are injured the NHS will still treat you, and the money has to come from somewhere.
- infinite8s 10y ago
  That's interesting, in the US it is the opposite, although you might be able to write off certain things as expenses so your overall taxable income is lower.
- rwmj 10y ago
  I believe you are thinking of people who set up companies and pay themselves through dividends (which have a much lower tax rate), which is now (highly controversially) illegal -- search for "IR35". Ordinary self-employed people and sole traders pay nearly the same tax rates as employed people (National Insurance, a strange disguised tax, is at a different rate), but have many fewer rights, eg. no right to paid time off or sick pay. The question in this case is whether Uber drivers are self-employed or not. Not as it turns out.
  - nvarsj 10y ago
    > pay themselves through dividends (which have a much lower tax rate), which is now (highly controversially) illegal What on earth are you talking about... taking out dividends is not illegal, even for individual company owners. IR35 is about HMRC forcing self employed people to apply payroll taxes as if they were employed. Again, nothing to do with dividends.
rb2k_ 10y ago
I was "self-employed" ("Freiberufler") and working for a US startup 100% of my billable hours. They hadn't formed a company in Germany at that point, so I just send them a bill and paid the employer and employee part of my health insurance. I got some letters about that and they asked me to prove that I was indeed self-employed. They didn't like the argument and concluded that I wasn't. The only thing that actually happened after a while is that I had to pay into the public retirement fund against my will. The "Deutsche Rentenversicherung" are seemingly the only people that care. From what I can tell there were no other obligations/rights that appeared after.
- detaro 10y ago
  I'm not a lawyer, but what I remember from talking with self-employed family members: There are different parts of German law/government that are affected, retirement is only one of them (and just because one authority noticed/thinks you qualify doesn't automatically mean that the others do). Tax avoidance (since payroll taxes on your salary weren't paid) is another angle. For the employer, not paying their part in your social security contributions is similar to not paying you your full salary, and thus a criminal matter as well.

jasode 10y ago

>English law recognises that there is a continuum [...] There's no bright line, edge cases are ruled on case-by-case in the tribunal, Sure, I understand that. USA law is fuzzy in the same way. (The IRS 20 rules[1] are guidelines and not binary true false criteria usable for perfect machine learning classification.) But for the sake of discussion purposes on HN, I'd like for you or anyone to play the role of general counsel for Uber and say exactly and concretely what they would need to do. [1]https://www.google.com/search?q=irs+20+rules https://www.google.com/search?q=irs+20+rules

pmyteh 10y ago
I'm not a lawyer; my exposure to employment law came in a previous existence as a workplace union rep and this is somewhat outside my expertise. As I understand it, if the Uber driver were allowed to have someone else drive their car for Uber when they felt like it, and had the freedom (actual, not nominal) to decide which clients they'd like to take on, and had control of their pricing, then there would be no question it was actual self-employment.