Working with contractors? Get it right!


I’ve heard so many people ask over the last few months, “how much more can small businesses be expected to take?”. The comments have come after discussions about the introduction of the National Living Wage and the Pension Auto-Enrolment staging dates that are looming for many small businesses.

All these people are right, the burden on small employers is getting greater and greater and as I chat with small business owners I know many are steering away from employing people and looking to work on a contract / consultancy basis to achieve the support for their growing business that they need.

I’ve been asked to provide support on consultancy agreements and contractor arrangements numerous times over the past couple of months, most recently yesterday.

In a recent blog post, I explored the key contents of an employment contract but given the queries that I’ve been having it’s clear there’s a need for clarity on contracting arrangements.

The biggest issue seems to be defining the relationship between the parties, so there can be no comeback on your business and allegations of being an employer/employee relationship.

One of the biggest factors in the arrangement to clarify this is that the contractor has the freedom to choose how, when and where they carry out the work that is required under the agreement and that the contractor can choose for that work to be carried out by any other person, for example within their employment.

I can’t stress enough though the need to have a clear written agreement in place when working with contractors. You need to protect your client base, you need to ensure that your expectations are laid down clearly and remedies for errors etc. are made very clear. I know of a business that has lost 4 clients due to the actions of a contractor. They can’t do anything about it as there wasn’t an agreement in place.

I’m always of the strong opinion that a one size fits all approach doesn’t work well for employment arrangements and I feel just as strongly on this topic as well. You need to look at all the factors of the arrangement with your contractors and get them in writing.

Please don’t leave it too late.

If you are an employer and need assistance with staff and employment matters, talk to Cheryl at PeakHR. We offer competitive rates and cater specifically for small employers.

Please note our blog posts contain general information and are intended as guidance only and should not be taken as an authoritative or current interpretation of the law. Please ensure that you obtain advice tailored to your individual situation before taking action. These posts apply to the UK only.

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