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When is a groom an employee?
This week’s Horse & Hound Business News raises concern about grooms injured at work and highlights the plight of the self-employed groom. But do such creatures exist as a matter of law? Legally speaking, it makes very little difference what grooms and their employers agree between them about the employment status or what document they sign. It is not even a matter of whether they are on PAYE or paying a self-employed stamp. The real question is whether the underlying nature of the relationship is that of employment. There are two reasons why the difference may matter.
- The first is tax – if HMRC decide that a particular groom is really an employee (which in many cases will apply equally to a whole yard of them) they can insist on them switching to PAYE and require payment of all the arrears of tax plus interest and penalties. They will look first to the employer for the money and he will have to (try to) get some of it back from the grooms from whose pay it should have been deducted in the first place.
- The second is employer liability– if a groom is injured he may pursue a claim for damages and this will be handled by the insurance company if the employer has appropriate cover. He may also be dismissed because he can no longer do the job. In the right (or wrong!) circumstances this can lead to an Employment Tribunal claim for Constructive or Unfair Dismissal and this may well not be covered by the employer’s public liability insurance policy.
So when is a groom an employee? It depends on a number of factors such as: whether he is obliged to turn up for work, can he send a substitute if he likes, does the employer have to give him a minimum number of hours of work, does he have to give him any work at all, how much control is exercised over the way he does the job, does he supply his own grooming and yard tools, does he file his own accounts with HMRC, does he carry his own insurance and does he work for a number of different yards? The concern voiced this week by H&H applies mainly where a groom has no insurance of his own and that is just the sort of factor which tends to suggest he is not self-employed but an employee. And that is where the employer’s troubles can begin.
If you would like advice on whether someone is employed or self-employed contact Jill Headford on 01392 207020 or email firstname.lastname@example.org