Self employed or employee status

[Sconhome]

I am curious as to how a definition is made at to whether a fulltime sale representative is an employee of a company or a self employed contractor.

Is there anywhere that this information can be found?

I have been told that the rep would be responsible for all their own expenses, travel, phone etc and would be paid commission per sale. You are required to work hours dictated by the company, and attend regular meetings and training in the company HQ.

There is no entitlement to paid holidays, PRSI, paye, pension etc.

Any thoughts, guidance would be appreciated.

 

[Pat Bateman]

Straight away, this sounds like an employee situation. There are a number of tests - Do you work for other people, can you subcontract the work, do you set your own hours etc.

Check out Revenue's guide (it's the PDF half way down the page):

http://www.revenue.ie/en/tax/rct/construction.html

Usually in cases where it's questionable, it's the employer being sly and trying to avoid Employers PRSI and their obligations in the area of redundancy etc.

 

[Sconhome]

Thanks Pat.

Are these Revenue rules applicable only to the construction industry? I had a suspicion that this scheme would be to avoid employee rights being accrued.

Apart from the lack of rights, stamps etc. there would be a need for the sales rep to register for vat as the levels of income should exceed the threshold. I know from other threads that the 'self employed contractor' is quite common in the I.T. industry but again it flaunts the rules of employee Vs contractor as defined by the RCT guidelines.

 

[Pat Bateman]

Thanks Pat.

Are these Revenue rules applicable only to the construction industry? I had a suspicion that this scheme would be to avoid employee rights being accrued.

Apart from the lack of rights, stamps etc. there would be a need for the sales rep to register for vat as the levels of income should exceed the threshold. I know from other threads that the 'self employed contractor' is quite common in the I.T. industry but again it flaunts the rules of employee Vs contractor as defined by the RCT guidelines.

Hi Sconhome.

Those rules are applicable to all industries.

While there may be bona fides cases of subcontracting, my own view (and Revenue's) is that there's more often than not abuse taking place.

 

[invest-or]

Those rules are applicable to all industries.

In respect of say an I.T. contractor, does operating through a limited company rather than as a sole-trader mean one doesn't need to meet these criteria?

Similar, does operating as a sole trader but through an agency mean one doesn't need to meet the criteria?

(I'm an IT contractor, but wouldn't meet many of the criteria, nor would any other contractors I know!)