Hassle free freelancer compliance with a freelancer management system
Keeping Your Company Compliant when working with Freelancers
Being compliant when it comes to working with freelancers is important for a number of legal and tax reasons. Whilst it isn’t the most interesting aspect of running a business, making sure your company is compliant can feel like a lot of extra work for your HR and legal teams, but there is a hassle-free way to work.
We share some of the top tips for hassle-free hiring whilst ensuring your business is compliant and secure.
Put a working contract in place
Contracts are an important part of making sure your business is compliant with the law and they can help protect your company should you ever need to use it.
Before you start working with anyone on a freelance basis, you should have a contract in place that covers your business from a legal perspective. Include your expectations from their side as well as what your business will offer them during the time they’re working with you.
It is also super important to include Data Protection, Confidentiality and IP alignment. You can also include other features such as DBS checks or specific NDA’s.
Contracts protect both your business and the freelancers you’re working with so it’s in everyone’s interest to have them in place- not just to be legally compliant.
Find the right level of insurance
The next thing to put in place for your company is the right level of insurance for working with freelancers, especially when it comes to IR35. The right insurance policies will cover bookings outside ofIR35 including the tax owed should you fail at tribunal.
It’s also important to ensure you hire freelancers with validated insurance policies covering Professional Indemnity and Public Liability as a minimum.
Some freelancer management portals, like YunoJuno, offer comprehensive insurance as a standard, as well as including all Right to Work Checks whilst storing all the data safely within GDPR guidelines which takes the pressure off businesses.
HMRC and IR35
Larger companies now need to assess if a contract or project is going to be Inside or Outside of IR35 before engaging with a freelancer structured as a Personal Service Company. It’s their responsibility to supply a valid SDS, making sure they’re able to pay a freelancer working Inside of IR35 taxing them at the source.
IR35 is a very grey area and for most running assessments can be very time consuming with the threat of HRMC and reputational damage hanging over you.
A Freelancer Management Platform like YunoJuno reduces the risk and ensures compliance is upheld across your business.
Using A Freelancer Management System To Handle Compliance
Whatever way your business chooses to work with freelancers, there is a legal requirement to have a compliant payment path to satisfy HMRC that all the right tax deductions are met. There is a quicker, hassle-free way to handle compliance internally- using a freelancer management system.
Take the pressure off your in-house teams and use a fully compliant freelancer management system to onboard, manage, contract, and pay all your freelancers. A freelancer management system like YunoJuno handles all the compliance around hiring freelancers so you can stay on top of focusing on the work at hand. Why not arrange your demo today.
| Old rule (2021 Independent Contractor Rule) | New Rule (Effective March 11, 2024) | |
|---|---|---|
| Basis of classification | Relied on a simpler, more straightforward approach that may not fully capture the complexity of modern work relationships. | Restores a multifactor "economic reality" test that considers a wider range of factors to determine employment status. |
| Legal consistency | Criticised for deviating from established legal precedent and potentially leading to more misclassifications. | Aims to align closely with longstanding legal precedent, offering more clarity and consistency in classification decisions. |
| Impact on workers | Concerns were raised that it might make it easier to classify workers as independent contractors, potentially denying them employment benefits. | Seeks to reduce the risk of misclassification, ensuring workers who should be classified as employees receive the benefits and protections that they're entitled to receive. |
| Guidance for employers | Provide a simpler framework for employers to classify workers, which could lead to broader interpretations and confusion. | Offers detailed guidance through the economic reality test, aiming to provide a clearer path for proper classification and reduce misclassifications. |
