Contracts
The question of contracts is simple to answer. No one needs a written contract. No contract can be less than the law prescribes.
Where no written contract is in place the law provides that one is to be pressumed. It will be no less than the law provides. Where actual practice differs from the written contract then the actual working practice is pressumed to be the actual contract.
In the wider sense it is no different whether you are self employed or employed.
Sherburn Aero club went to court with HMRC to establish the right of instructors to be self employed and the right for the club to use instructor sub contractors. This was the second case to be tested by the Tax Commissioners. The previous case involved Mal Scaffolding. Sherburn Aero club were successful on all points as were the scaffolding contractor. The most important principle being that the individual parties to the contract have the right to decide. Issues such as uniforms, regular work, whether or not others working alongside were fully employed doing the same job, were not the issue as the HMRC had previously insisted.
With regards to the insurance held or not by instructors. It was inevitable for us that this particular issue raised its head. The insurers were content to include the instructors with Public Liability and Employers Liabilty held by the club. The HMRC were content to accept the provision of the benefit as acceptable to them as not being a benefit in kind when the instructor actually paid for it. A notional sum of £1.50 per month was agreed with the HMRC as being sufficient for the insurance cover not to be considered a payment in kind. I believe the insurers were surprised to be asked by us for they had always considered the instructors to be in coverage. It was not a matter for them under what contract the instructor was employed.
The CRB checks are a worry. Not because of any outcome and the cost but rather the time it takes to get one. In many cases the instructor will have moved on by the time any clearance came through. Instructors commonly work for different clubs and would if required need to obtain a CRB check for each club. Should the law be uncovered to mean that Flight Instructors do need to have a CRB check then clubs would need to restrict instructing for those under 16 years to one or two instructors who have previously demonstrated their long term commitment to the club.