Umbrella Company News

Supervision, Direction or Control – What Does This Mean For You?

The definitions of Supervision, Direction or Control (SDC) are as follows:

Supervision is when someone overseeing a person doing work to ensure that the person is doing the work they are required to do and it is being done correctly to the required standard.  Supervision can also involve helping the person where appropriate in order to develop their skills and knowledge.

Direction is someone making a person do his/her work in a certain way by providing them with instructions, guidance or advice as to how the work must be done.  Someone providing direction can also co-ordinarte how the work is done as it is being undertaken.

Control is someone dictating what work a person does and how they go about doing it.  Control also includes someone having the power to move the person from one job to another.

To ascertain whether a worker falls within these definitions, HMRC will consider the overall arrangement including how the contract is undertaken in practice – it’s simply not enough for a paper trail to be in place; the practicalities have to match the documentation supporting it.

Who will this apply to?

In reality, we consider that there won’t be many contractors who can be considered as outside of the SDC legislation; given that the SDC doesn’t actually need to be used, it just needs to be present as a right to either supervise, direct or control.

How do we determine whether this applies?

We have to be clear in our understanding through discussions with an agency and end users whether the worker falls under these definitions, and select the best options as determined through these conversations. To manage risks and liability, these conversations should always be confirmed in writing and in conjunction with the worker.

We have already assessed our existing employees, and where relevant, will assess our new employees in the same way prior to making any payments to them. If you have any questions about this, or would like to understand options available please contact us anytime on 02071642116 for further information.