Category Archives: young workers

Time to get people to help in your business?

FreelanceWhen you start your business there is just you and your idea.

Before you know it you need people to help you.  Whether it is your family volunteering to help out, interns, apprentices, volunteers, freelancer or staff, your business success depends as much on how you manage these relationships as it is by your customer and service focus.

Don’t be fooled into thinking only employees have rights at work and you can just abolish all your troubles if you call everyone an intern or a freelancer.

Suppose you employed 9 people on a freelance basis for five years?  Only paid them when you wanted them, no holiday worries, no employment law?

Suppose one took you to tribunal and claimed they were really your employee (and claimed unfair dismissal when you stopped using them).

Suppose they won (tribunals look beyond the label into the real relationship).

Then HMRC wanted the  PAYE on all these ‘freelancers’ (going back a few years).

Could you find the money to sort it all out?  This time they wanted £12,500.

It happens, this is real.

Don’t be scared.  Don’t ignore it.  Handle it.

The best way to handle this in advance.

If you need advice and guidance on employing freelance workers check our Freelance Framework Agreement.

For a free MP3 of Annabels entertaining talk on this subject click

Annabel Kaye is Managing Director of Irenicon Ltd, a specialist employment law consultancy.
Tel: 08452 303050 Fax: 08452 303060 Website:
You can follow Annabel on Twitter


Filed under agency workers, contract, employment law, employment tribunal, free stuff, young workers

Are employers exploiting commission only workers?

In common with many families this year, my youngest son left university and started looking for work. He was amazed to get an interview quite rapidly.  After a day’s assessment he was offered a job on a commission-only basis.

The job involved four hours a day ‘administration’, when no commission could be earned. There was no guaranteed minimum for pay, and most of the employees he spoke to worked 13 hour days six days a week. He turned the job down, but lots of people were working there.

Young workers who do not have employment law specialists as their parents don’t always know what their legal entitlements are. But when it comes to commission work, here is how it goes.

1) Whatever the rate of commission, pay must not fall below National Minimum wage for the hours worked (eg there is always a ‘floor’)

2) If you are over 21 the minimum hourly rate is £6.31. It will go up in October 2013. For other rates click here:

3) Wages are calculated within a reference period – normally the pay interval, which would usually be weekly or monthly.

4) All the hours you are at work (except when on breaks away from work and the workplace) are part of the calculation – if you are in a telephone bank and ‘on call’, it is not just the time you spend on the phone that counts, but all the time you are sitting there waiting to answer a phone.

5) If you work in an office to do your commission based work, you are on a ‘time base’ – click here  for how to calculate your hourly rates on line.

6) You take the number of hours worked (so it is important to keep a proper record) and the commission earned, and divide the hours into the commission to get the hourly rate. For example for a weekly paid worker:

Commission £80/Hours worked: 40 hours this week = Hourly rate £2 per hour

7) The fact you agreed to a lower rate, or signed a contract, or didn’t get one is not relevant to your entitlement to minimum wage – if you are an employee or a worker (eg not running your own business but working for them) then this entitlement exists.  If they tell you are self-employed this doesn’t change anything.

8) If you have been underpaid National Minimum Wage, you can get back pay for up to three years to bring you up to the right rate. You can get free help from the Workers Rights helpline 0800 917 2368, who specialise in this area.

9) You can make an anonymous complaint online to HMRC –your boss does not have to know it was you who complained click here for the form to start things off

So if you are offered a commission-only job ask your employer:

  1. What is the period of calculation for commissions (eg weekly, monthly, quarterly, annually)
  2. What is the pay period (weekly, monthly)
  3. What happens if for some reason my commission falls below minimum wage

You need to keep proper records from the start of:

  1. How many hours you worked
  2. How much you were paid
  3. Any advances against commission (they do not count towards minimum wage)
  4. Keep copies of the advertisement, job offer letter, contract – don’t lose them

And you need to check your payslip and commission statements to make sure your gross pay (before tax and national insurance) tallies with your records. We spend a lot of time getting commission for workers who have simply not been paid it.

While some employers do make mistakes, and there is the odd one who really doesn’t understand minimum wage, in the main employers who do not honour minimum wage or pay the proper amount of commission are not for the long term. You should be job hunting for something better.

More help?

If you are boss reading this, then you can find some proper Commission Only contracts that take account of minimum wage (and statutory holiday and more) click here.

We run regular free dial in sessions on Commission based workers/employees and their rights.  They are one hour by phone.  To find the next free event click here

Unions are waking up to this and are beginning to take test cases – the first ‘marketing’ companies are under the spotlight -….more

Annabel Kaye is Managing Director of Irenicon Ltd, a specialist employment law consultancy.
Tel: 08452 303050 Fax: 08452 303060 Website :
You can follow Annabel on Twitter


Filed under employment law, pay, young workers

The unpaid intern ….

The “unpaid intern” is usual in the media, fashion, publishing, broadcasting, and politics.  But just because something is common does not make it right, and it doesn’t make it lawful either.

Many industries are notorious for ‘interns supervising interns’ with hardly anyone being paid at all.  Some high street names and even MPs advertise this sort of roles.  Don’t be fooled.  They are not always legal.  HMRC can and do investigate these arrangements – check out some of the news on High Street names.

You can understand the advantages of the arrangement from both sides.  The ‘intern’ hopes to get experience that will help to bolster their cv.  And the employer gets a ‘free’ look at possible candidates, and may (if lucky) get some useful work that outweighs the cost that comes from the disruption and distraction to experienced staff.

But – and it’s a big ‘but’ – these arrangements often seem to ignore the National Minimum Wage [NMW] rules.

In the UK, anyone under a contract (which can be oral or in writing) whereby they undertake personally to do any work or perform any services is entitled to the NMW (at the relevant rate) unless they fall within specific and limited exemptions.

The exemptions are complex and have a variety of conditions applied to them.  To be accurate and complete about them would take a book!  But as a quick summary:

The label someone has (for example: trainee, probationer, intern) makes no difference.

Trainees or probationers or interns ARE entitled to NMW unless they are:

1) on specific government training schemes such as:  Entry to Employment or Programme Led Apprenticeships; Skillbuild ; Get Ready for Work or Skillseekers; Training for Success; or

2) on European Social Funded or Government funded placements of less than six weeks; or

3) volunteers working for a charity, voluntary organisation (such as a local community organisation) associated fund raising body or statutory body; or

4) students on a higher or further education course including a work experience requirement of not more than one year.

Individuals on an ‘internship’ leading to paid employment are often entitled to minimum wage throughout their ‘internship’ and paid employment period – because they are working.

HMRC enforces minimum wage rules. Their guidance suggests that a person who is simply ‘shadowing’ team members in different parts of an organisation is not performing work, and in that case would not qualify for NMW.

Work observation or work experience?

So, if the “work experience” is actually just “work observation”, and the individual is not required to do any work, then it doesn’t have to be paid.  But if “work experience” involves actual working, then, unless one of the specific exclusions applies, NMW minimum pay rates must be paid – at the risk of both paying back pay to the individual, and a hefty fine.

Christopher Head is director of specialist employment law consultancy Irenicon Ltd.  Christopher helps people to get the law on their side, and to avoid being tripped up by rules they don’t know about.

For free teleseminars on managing volunteers (including genuine interns) , freelancers and more check our KoffeeKlatch events page

Tel: 08452 303050  Fax: 08452 303060  Website :


Filed under employment law, pay, young workers

Government can’t follow it’s own rules

The Swine flu helpline has been caught out using workers under 18 at times when it is illegal for them to work. 

This is not the first time the Government has had difficulty in interpreting or applying employment law legislation.  From losing millions by printing incorrect advice on discipline and dismissal or TUPE to failing to comply with the basic rules of employment when acting as an employer the UK government seems to have the view that laws are for other people.

Whilst MPs are content to churn out complex rules to cover the smallest UK employer, the reality is the government departments cannot follow the rules they impose on everyone else.  Why?  

Is it that the rules are so difficult to understand and interpret? – in which case why not make them easier?.

Or is it that senior officials take the view the rules don’t apply to them?

Why not survey government departments for compliance before we impose these rules on smaller businesses?  Anything they can’t comply with let’s suspend while we get it simplified.

With the tax payers millions at their disposal and the benefit of having written the rules – if they can’t comply how can anyone else?

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Filed under swine flu, young workers

Paperboys, young workers and illegal contracts

Reports of a 15 year paperboy finding he had no employment rights make most intriguing reading.

There are legal limits on not only the hours a school age person can work, but the actual start and finish times. Some free spirits may view this as discrimination against young workers, others as protection against being exploited when school should be a priority. Either way this young worker sought to enforce his rights but found himself not having any!

The case is at tribunal level and be subject to appeal. It would seem that most paperboys/girls are really young part time employees and I am not at all clear how the tribunal found – no mutuality. Like any other part time worker this boy was supposed to turn up at a certain time, do a certain number of hours of work and get paid a certain sum. It is not obvious where the lack of mutuality arose!

On the basis of the reports, the ’employer’ plainly required this young person to turn up at an illegal time. There is a long history of employment rights being affected by whether or not the contract is ‘tainted with illegality’ and few ordinary individuals seem to understand how it works.

  • If I commission you to steal a car and you do so and deliver it to me, you cannot sue me if I don’t pay you, since the courts will not enforce a contract tainted with illegality – think of it as an outlaw clause – if you are outside the law it won’t protect you.
  • If I employ you and we both agree there will be no tax and deductions payable (where they would normally be due) ‘cash in hand’ then you will find an employment tribunal will not give you any unfair dismissal rights since the contracted is tainted with illegality – although what you did may have been legal, the way we arranged to pay you was not and this has the same effect.
  • If your employer gives you itemised pay statement showing deductions for tax and NI but does not make them, this does not have the same effect since you would have no way of knowing.

This has had an interesting effect when it comes to illegal immigrants employed in breach of immigration rules. Unscrupulous employers have managed to use the ‘taint’ clauses to get out of unfair dismissal claims. This does mean confessing to another breach or crime – so this is not a ‘get out of jail’ clause for employers but nonetheless it can leave employees without any rights. Recent cases have suggested the race discrimination (and by other implication other forms of discrimination ) rights exist whether there is ‘taint’ since these rights to not rely on a contract of employment. Perhaps age discrimination rights also exist in this way and the young paperboy can find a way to show a contract of employment or failing that that he was discriminated against on the grounds of his age?

Meanwhile if you want employment protection in the fullest sense, check you get itemised pay statements and that you are ‘paying into the club’ that gives you admission to full employment rights – eg tax and national insurance where you earn enough to need to pay it.

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Filed under discrimination, young workers