Moving staff from self employed to employed

Discussion in 'Employment & HR' started by Redd, Feb 28, 2018.

  1. Newchodge

    Newchodge UKBF Big Shot Free Member

    11,316 2,902
    You can require that they use their holidays when snowed off, but they can only do that if they have enough holiday left. If they have no holiday and offer to attend work, although you cannot give them work because of the weather, you would still have to pay them, although you could find them alternative work, like tidying the yard, for instance. You can try to get round that problem by having the annual leave year start on 1 October, for instance.
     
    Posted: Mar 1, 2018 By: Newchodge Member since: Nov 8, 2012
    #41
  2. Redd

    Redd UKBF Regular Full Member

    185 11
    ok thats works ;) was also thinking of rather than decrease their wages I believe I can increase their hours to compensate with no further holidays due at 28 days? is that right as currently they work Saturdays until 12pm. I could move this to 4 pm and not lose out?
     
    Posted: Mar 1, 2018 By: Redd Member since: May 4, 2013
    #42
  3. Newchodge

    Newchodge UKBF Big Shot Free Member

    11,316 2,902
    Sorry, I'm not certain as I haven't come across it with any client. I believe that you would be responsible for paying the tax and NI that should have been paid. The .gov website states there would be penalties, but I can't find anywhere that specifies what they are. This is quite a good guide to whether you have a problem. https://www.gov.uk/employment-status/selfemployed-contractor

    It may be worthwhile going through the status checker, if you think they may be self employed - do it anonymously, and if it comes in your favour, give your business details as, provided you have done it honestly, you will not get penalties if the answer is wrong.

    The other thing to bear in mind is employment rights. You may all be happy working together at the moment, but if one of them falls out with you they can try to claim they were employees all along, and claim their holiday pay etc.
     
    Posted: Mar 1, 2018 By: Newchodge Member since: Nov 8, 2012
    #43
  4. Newchodge

    Newchodge UKBF Big Shot Free Member

    11,316 2,902
    The maximum minimum holiday entitlement is 28 days, even if someone works a 6 day week. They only get 4.7 weeks, effectively.
     
    Posted: Mar 1, 2018 By: Newchodge Member since: Nov 8, 2012
    #44
  5. Chris Ashdown

    Chris Ashdown UKBF Legend Free Member

    9,980 2,028
    You have been looking at your present workforce, don't forget you can advertise for new full time staff and slowly cut out the freelancers, just get your first team and keep them separated from the others so they work on your terms and not get away with the others maybe more casual approach

    For the long term guys make sure they are on a 2 or 3 month contract may help avoid HMRC in the short term, but long term you need to play by the rules
     
    Posted: Mar 1, 2018 By: Chris Ashdown Member since: Dec 7, 2003
    #45
  6. Mr D

    Mr D UKBF Legend Free Member

    12,469 1,317
    Yes so long as you book it as holidays with the staff at least a couple of days in advance. If you want to have them use a week's leave then book it a couple of weeks in advance.
    You cannot say to them - I am classing today as a holiday and using up a day of your leave.
     
    Posted: Mar 1, 2018 By: Mr D Member since: Feb 12, 2017
    #46
  7. Redd

    Redd UKBF Regular Full Member

    185 11
    Hi Guys. Hopefully a notification still comes through on this old post of mine.

    After taken lots of advice on this and moving pretty much all my guys from sub contractors/cis to employed with holiday pay, vans, fuel cards etc I have got to say I am on the verge of just giving up and trying something else.

    We are just not making good money anymore and I am merely working for a wage. I really don’t know what else to do. My guys are on a decent take home pay of around £450 pw but once I have paid their N.I and contributed to their N.I and done the same with Pension and paid there paye it is working out at circa £850 per week I am paying per fitter per week against £550 + 100 cis. £200 extra per week per guy (we currrntly have 9 made up of three teams plus me and my wife who works in office full time now.

    This is so frustrating as we are now the main go to company in our industry in Edinburgh, I am not biased but I know my competition and none of them are doing the amount of work we are doing, none of them have brand recognition and in actual fact a lot of them are copying us (two even copied our logo and another our name minus the “The” which I am of course contesting)
    We are turning over approx 600k each year now with plans to take it to 1 million this year but zero dividends to take out! I only walk out with £550 a week so don’t think I’m over paying myself. I can’t help but feel cheated for doing things right.

    Ps...Doing it the cis way I was able to take out anything between 50-80k per year with 1/2 teams. Now we have 3/4 teams I’m not getting any dividend albeit Im paying myself more than the 11500 I was then and my wife wasn’t on the payroll
     
    Posted: Feb 25, 2019 By: Redd Member since: May 4, 2013
    #47
  8. Chris Ashdown

    Chris Ashdown UKBF Legend Free Member

    9,980 2,028
    Maybe a break down of how you get from £450pw to £850pw would help others to look at it as it seems a lot of increase
     
    Posted: Feb 25, 2019 By: Chris Ashdown Member since: Dec 7, 2003
    #48
  9. Newchodge

    Newchodge UKBF Big Shot Free Member

    11,316 2,902
    You should only be paying an extra 13.8% NI and 2% pension, unles you have increased the staff wages for some reason? paye and employee 12% Ni and 3% pension come out of their income, not yours.

    The downside of doing it the way you were doing was the possibility of HMRC coming after you for all the tax and NI that you did not deduct from the moeny you had paid them. That would have really hurt!
     
    Posted: Feb 25, 2019 By: Newchodge Member since: Nov 8, 2012
    #49
  10. Redd

    Redd UKBF Regular Full Member

    185 11
    National ins £69
    Employers n.i contr £79
    Paye £102
    Pension £17.75
    Employer Cont £22

    Something along the lines of this.....

    Cis would be £110
     
    Posted: Feb 25, 2019 By: Redd Member since: May 4, 2013
    #50
  11. Newchodge

    Newchodge UKBF Big Shot Free Member

    11,316 2,902
    It has only cost you £79+£22, so £101. The rest comes from the employee, although the pension figure looks wrong - the employee contribution should be higher than the employer's.
     
    Posted: Feb 25, 2019 By: Newchodge Member since: Nov 8, 2012
    #51
  12. Redd

    Redd UKBF Regular Full Member

    185 11
    When they were cis I didn’t pay any of the above figures just £110 cis
     
    Posted: Feb 25, 2019 By: Redd Member since: May 4, 2013
    #52
  13. Newchodge

    Newchodge UKBF Big Shot Free Member

    11,316 2,902
    You didn't pay anything. CIS was deducted from their pay.
     
    Posted: Feb 25, 2019 By: Newchodge Member since: Nov 8, 2012
    #53
  14. Redd

    Redd UKBF Regular Full Member

    185 11
    Can you explain how it’s taken off their wages if there on price work for example?
     
    Posted: Feb 25, 2019 By: Redd Member since: May 4, 2013
    #54
  15. Redd

    Redd UKBF Regular Full Member

    185 11
    Our accountant and the previous one tells us to ADD cis not deduct it.
     
    Posted: Feb 25, 2019 By: Redd Member since: May 4, 2013
    #55
  16. Newchodge

    Newchodge UKBF Big Shot Free Member

    11,316 2,902
    Your staff were self employed (allegedly). They told you how much they were charging you for the job, let's say £500. They invoice you for £500, you deduct 20% (if they are CIS registered) from their £500, give them £400 and give HMRC £100 as their contribution to their eventual tax. If your accountant told you ANYTHING differently, you need to have a word with them.
     
    Posted: Feb 25, 2019 By: Newchodge Member since: Nov 8, 2012
    #56
  17. Redd

    Redd UKBF Regular Full Member

    185 11
    Your obviously not clued up on the industry, employees (mainly skilled guys) tell you what they want to walk out with and that’s the rate. You pay tax on the amount paid whatever that may be as every job is different. Unfortunately in an unregulated industry where 90% of my competitors are paying cash that’s just the way it is.
     
    Posted: Feb 25, 2019 By: Redd Member since: May 4, 2013
    #57
  18. Redd

    Redd UKBF Regular Full Member

    185 11
    On the books is costing me circa £200 extra per fitter per week and costing me 4-5k extra a month. 5k i just cannot add on to the cost as by doing everything properly I am already 60-70% more expensive than my competition who again are mainly using sub contractors (or paying cis) or paying in cash or whatever other Avenue.
     
    Posted: Feb 25, 2019 By: Redd Member since: May 4, 2013
    #58
  19. Chris Ashdown

    Chris Ashdown UKBF Legend Free Member

    9,980 2,028
    Sorry Redd but you need to sort out who is the boss and what you are willing to pay, don't forget they want the work just as much as you want them to work for you

    Maybe you need to stand back and work out some budgets and cash flow to see where you are going, they are working for you,but it seems you are working for them and at a low wage
     
    Posted: Feb 25, 2019 By: Chris Ashdown Member since: Dec 7, 2003
    #59
  20. Mr D

    Mr D UKBF Legend Free Member

    12,469 1,317
    May be worth sitting down with an accountant and going over what you are paying and how.
     
    Posted: Feb 25, 2019 By: Mr D Member since: Feb 12, 2017
    #60