§ Mr. Paul Deanasked the Secretary of State for Social Services (1) what appeal rights are available to self-employed people who are reclassified as employees; and what is the classification of such individuals while their appeals are being considered;
(2) what is the definition of self-employment for national insurance purposes; and what procedures are followed in cases where self-employed people are reclassified as employees.
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§ Mr. OrmeIn the Social Security Act 1975, a"self-employed earner"means a person who is gainfully employed, but not under a contract of service or apprenticeship—whether written or oral, and whether expressed or implied—nor in an office, including elective office, with emoluments chargeable to income tax under schedule E.
Inspectors of the Department give advice to the categorisation of earners, and arrangements are made accordingly for the future payment of contributions and for the collection of arrears or refund of contributions. If the advice is not accepted, an interested party may make an application under section 93 of the Act to have the question decided by the Secretary of State acting judicially. There is a right of appeal to the High Court on a question of law against the Secretary of State's decision.
Where a decision is pending in a case in which the Department had advised that the individual was an employed earner, the payment of employed earner's contributions is normally recommended in order that, if the decision confirms the Department's advice, the employer will not be at risk of being unable to recover the employee's share of the contributions.