The right to provide a substitute or replacement worker is alien to both the theory and practice of employment. No employed worker would be allowed to send in his place an alternative worker, engaged and paid by him. The right to send a substitute worker, egaged and paid by the original worker, places the original worker outside of employment status. This was confirmed by the Court of Appeal decision in
Express And Echo Publications Ltd v Tanton.
Thus the best defence against a status challenge is for the Personal Service Company to have a right of substitution, better still a right to provide any workers of its own choice, written into its contracts. Of course, the right must be acknowledged by the end client and be capable of being put into practice. The right must also be free of unreasonable conditions or fetters.
HM Revenue & Customs have argued that unless the right of substitution is exercised in practice, it carries little or no weight in deciding employment status. They quote High Court decision in
Synaptek v Young. It is helpful therefore if the Personal Service Company does exercise its right to use a substitute worker during the course of an engagement.
Qdos Consulting can assist you in establishing a right of substitution.