Working from home
Thursday, 04 September 2014
Different Types of Employment Status
There are three main types of employment status (“employee”, “worker” and “self-employed”) and depending on which category you fall into, you will have certain legal rights.
Employees make up the largest group of working people in the UK. All employees are workers, but an employee's rights are more wide-ranging than people of other employment status. They also have a number of responsibilities, the most notable of which is that they are required to provide a minimum notice period before leaving their job. An employee will work under a contract of service, which is normally a written document but can also be verbal, implied or a mix of the three. An employee has the rights that all workers have, plus:
- The right to Statutory Sick Pay
- The right to minimum statement of employment terms
- The right to minimum notice period of employment ending (such as in the case of dismissal)
- The right to not be unfairly dismissed
- The right to maternity/paternity/adoption leave and pay
- The right to request flexible working hours
- The right to time off for emergencies
- The right to Statutory Redundancy Pay
Minimum length of employment
In some cases, an employee will be required to serve a minimum length of employment before they qualify for certain rights. In other cases, employees might enjoy enhanced entitlements that exceed their statutory rights which would be stipulated in an employment contract and is largely at the discretion of an employer as to whether they want to offer them.
Who is a worker?
Workers include people working under a range of contracts and are defined more broadly than employees. Though employees are workers, a "worker" is only defined as someone with the core employment rights, which are:
- The right to receive the National Minimum Wage (though this varies between age groups)
- The right to protection against unlawful deduction from wages
- The right to a minimum paid holiday period (annual leave)
- The right to minimum length of rest breaks (depending on hours worked)
- The right to not work more than 48 hours per week, or to opt out of doing so
- The right to protection against unlawful discrimination
- The right to protection for "whistleblowing" (if you need to report wrongdoing in the workplace)
Some workers might also be entitled to Statutory Sick Pay and Statutory Maternity/Paternity/Adoption Pay. Though entitlement to these will depend on a number of other factors, including how much you earn. To establish worker status you have to perform work or services in person (and not send a substitute or sub-contract out work), and you cannot undertake work as part of your own business (your employer cannot be a "client").
Self-employed people are not generally covered by employment legislation, as you are your own boss in the eyes of the law. You will be protected in terms of your personal health and safety and against discrimination, but any further rights will be set out by the terms of any contract you may have with a client. Self-employed people tend to have greater working freedom than other types of employment status, but will bear more financial risk.
Self-employed people must register with HM Revenue and Customs, submit an annual tax return and account for all tax/National Insurance payments. If you work from home, you will also need to make sure you have valid home insurance that covers you for business purposes.
Most standard insurance policies will not cover you for anything more than basic clerical work, and may be invalidated when you are working from home.
Insurance from HomeProtect can be gained with a competitive online quote, and can protect you with both business contents insurance and standard home cover as well. Business from home insurance is needed to make sure that you and your clients are protected as well as possible.