Types of worker

There are three main types of employment status for individuals in the UK. One initial question is what type of worker you need to engage or employ to assist you in your new business:

1. Employees
2. Independent Contractors (e.g., people who are self-employed)
3. Workers

You should give careful consideration to the type of individual you wish to employ or engage. This decision will be driven by the level and type of work you require them to perform and how much control you need to have over the individual.

Employment status is important because:

• different types of worker are entitled to different employment rights;
• even if you label someone a certain type of worker, they may not be deemed to be that type by law (i.e., the courts can look at the evidence and circumstances and decide they are in fact a different type of worker) and;
• it will influence what type of contract (e.g., documents) you provide the individuals with.

You should ensure that individuals are employed or engaged on an appropriate contract. For example, a full contract of employment for employees or a consultancy agreement where you wish to take on an individual as an independent contractor.

For a simple comparison of the different rights given to different types of worker, and the factors that help determine employment status, see here. Set out below is a table summarising the key differences between the three types of employment status and their corresponding rights.

Employment Status: Types & Rights

Family members, volunteers and young people

Employers must take care if they plan to hire young people or family members.

Young people

English law places restrictions on the employment of young people. For these purposes, a 'child' is a person not over compulsory school age (at present 16).

The key points to remember as follows: