will working as self employed affect the right to redundancy pay

by exasperated 05 January 2012 |

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I'm not sure this is really 'tax' but apart from 'rip offs' nothing seemed appropriate.

the business (dance school (A)) my friend worked part time for has closed and she thinks she's entitled to a significant redundancy payment. she currently works 2 days a week as a secretary for NHS and some months ago (due to hours cut at the dance shool (A)) started to run a dance class one afternoon a week on for herself. she advised the tax office of this. if she takes additional work (as self employed) for about 3 hours a week will the dance school (A) be able to refuse to pay her any redundancy payment entitlement.

the problem here is this work would be helping/teaching with one of the partners from the dance school (school A) which has closed but who is starting her own new dance school (school B) but I understand she remains a partner in school (A) until the partnership business ends in May. The other partner (in dance school A) has said that if my friend is employed to work in school B she will not get any redundancy payment from school A. This is the same man who told my friend he was 'taking her off the books' about a month before she found out about the closure of the school (A) - she asked why and he said he'd leave her as employed

is employed the operative word here, rather than self employed when she could invoice school B for her time

at a few hours a week we are not talking mega bucks, but we don't want to ruin her chances of any redundancy payment very hard earned and well deserved but she has to eat!

I don't know why the partnership is still in is existence, maybe something to do with premises lease which runs to May?

my friend has no contract of employment.

if you have managed to wade through all this and kept up, thank you and even more so if anyone can give any help or advice. thanks.

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MikeGG1 posted
If A & B are 2 completely independent entities then your friend would be entitled to full redundancy on the closure of the first.

Service for subsequent redundancy would have been from the date of employment by the second employer. However, self-employment would rule that out. Compensation on termination of a self-employed contract would depend on the terms of the contract.

If A & B are not independent then there would need to be redundancy on the basis of the reduction in hours from the first employer and then compensation for switching to self-employment from the second employer.

Your friend needs to make certain of the relationship of the 2 employers and talk to CAB who should be able to give more help.

Mike

Posted on 06 January 2012 | Love 0 loves Report
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exasperated posted
thank you very much - hope you manage to wade through the next .....

schools A and B are indpendent however I think the fly in the ointment is the proprietor of new school B remains at the moment a partner in school A although she has not been involved particularly in its administration - more a 'sign here' type.

school B is being started as work for the partner who has no job due to the closure of school A which closed mid December. school A had established premises school B is renting a room 2 or 3 times a week in public buildings in separate different locations

it seems to me that school A person is trying to say B is taking over the employment so no redundancy would be payable, but my friend (as she is already running her afternoon class) had decided to be self employed for any dance work she could get. it is unfortunate that it is with school B whose proprietor appears to have a foot in both camps. no work employed or self employed has been done at the moment but obviously they need to start earning.

are you saying that if my friend does work as self employed this would be in order if school B proprietor had no connection with School A. "A" man partner said it is too late for the other partner to resign from the partnership would this be correct?

would there be any acceptable unemployed time gap between the employed work at school A finishing for my friend and the school B self employment commencing if school B proprietor cannot exticate herself from school A or could no work start until "B"s involvement with school A ended either if she could resign or when the partnership business ends.

apparently a notice on the door of school A at the beginning of December said school A business would cease trading 31/12/11 (however the school actually closed 17/12/11) would this be relevant at all? (this notice was all the information some staff had of the closure of the school!)

if you haven't fallen asleep thanks for taking the time.
Posted on 06 January 2012 | Love 0 loves Report
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SoftwareBear posted
Does your friend have a contract for the part time employment with dance school A.

The contract will state what she is entitled to in the event of redundancy.

But it sounds like she may have been TUPEd over to school B ... she may not be aware this has happened ... presumably she was given a P45 from school A and started to be paid by school B ?

Posted on 06 January 2012 | Love 0 loves Report
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exasperated posted
no, no contract of employment for part time work at school A

and no P45 yet. the date on this should be at the latest 17/12/2011 which was the saturday of her last week working there - I think?

she has not done any work for school B and it was never intended, is or has been employed by school B

i looked TUPE up and i think this is what school A man is trying to achieve in order to relieve himself of the redundancy payment.

thanks
Posted on 06 January 2012 | Love 0 loves Report
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SoftwareBear posted
Was she ever properly employed if there's no contract ?

How long did she work for school A ?
Posted on 06 January 2012 | Love 0 loves Report
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exasperated posted
thank you

very part time for over 30 years but even that amounts to something worthwhile we think. she spoke to the tax office/ACAS a few weeks ago who told her that in the absence of a contract of employment, I can't remember their exact words but they meant that the way the employment had been carried out would be the guidelines.

she had a payslip (of sorts) each week showing PAYE deducted (earnings not high enough for NIC)

I think she has also been told, not sure where this came from, that her redundancy package should have been agreed before she finished work. I think also she was given six weeks notice and should have been given 12 weeks notice of the school closing/redundancy.

any further thoughts appreciated. thanks

Posted on 06 January 2012 | Love 0 loves Report

will working as self employed affect the right to redundancy pay

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