Sherburn Aero Club

[bogbeagle]

The AGM is on the near horizon and I thought that this would be a good time to inform the membership about the Industrial Tribunal which Sherburn is currently dealing with.

Most of the club members will know me as David Turner and be aware that I have instructed at Sherburn for a few years.

You may also be aware that, a few weeks ago, I was sacked. Shortly afterwards, Ray Price felt compelled to leave, citing management style as the primary agent.

What you probably don't know, is that I am taking the club to an Industrial Tribunal, claiming unfair dismissal. I'm contending that, during my time at Sherburn, I was actually an employee....in spite of the management's assertions that I was self-employed.

So, later this month, myself and your committee shall be attending a Pre-hearing Review at which my employment status will be officially determined.

If the Review determines that I was self-employed, the case stops there and I have no claim against Sherburn.

If it is determined that I was an employee, I shall then continue with the Tribunal process, claiming unfair dismissal. Other instructors, no longer with Sherburn, watch with interest; as do the Inland Revenue.

That said, I should very much like to resume my post at Sherburn, under a different regime. I have enjoyed my work at the Club and I like to think that I have been a good instructor and colleague.

[PA38]

I had a similar case with a local transport opperator, I worked self employed driving coaches.
But because it was my only source of income and I couldnt send someone in my place I was deemed as employed.
That was 8 years ago legislation could have changed but not by that much..
If you are deemed as employed you will get all your self employed stamp payments back, and anything you paid in tax
Sherburn will be liable for the lot
Good luck...

[spernkey]

Employment

Must have suited you both to be S/E at the time.
Real big of you to say different when it doesn't.
Pilgrims like this prevent flexible mutually beneficial engagements.
Question - if Richard Branson or BA had approached you to say all they really needed was a couple of blokes like you (but you had to start monday) then i bet we would discover that you had been self-employed after all?
Thankfully people of this ilk never really get on in my experience.
Sadly the law is all on their side and the tribunal will only ever agree with the "Poor downtrodden" even if Sherburn genuinely believed they had a non exclusive S/E relationship. Poor bastards will probably end up having to pay the "missing" tax as if your pay was "net". Charming.
Another extra cost to add to the hourly rate - thanks a lot !

[29_Grass]

While SAC are in the spotlight on here, I thought it may be good time to mention how sad it is to see its decline. Over the last 15 years of being near or around the club it has been very sad to see what was such a warm friendly atmosphere decline to one that has a slightly cold unwelcoming feel to it (and im not necessarily referring to some of the fine members of staff who work there). It would seem that most folks choose to jump in their aircraft and go to other clubs to soak up the atmosphere returning only to park their planes then go home.

It may just be me, and, if so forgive my ramblings but it has been ongoing for a long time now. I can't help but feel that the club as become far too commercialised and regulated, a warm friendly atmosphere seems to have taken a back seat to rules and an emphasis to flying to the book (verse and all).

On a plus note i feel the winds of change coming.

David; best of luck with your tribunal, however it may be worth mentioning that SAC is owned by its members. it seems a shame that the actions of one (or indeed several individuals) is likely to cause hardship and repercussions for others

[PA38]

Wow Spernkey have you got a chip....
I was dumped on from a great height by someone I considered a friend, it was mutually beneficial at the time until it did not fit in with my work provider.
I then got dumped out of work without a second thought, so in my case it was justifiable revenge.
I will never feel sorry for the **** and as for never getting on, I now have a VERY VERY good job, so in fact he did me a favour

[skydriller]

I cant believe what Im hearing here !!

You must know whether you are self employed or not? Who paid NI contributions, who paid your tax etc.? Contract at all?

4 years ago I was offered a position on a self employed basis and when I pointed out that in that case I would consiously make myself available to work for other companies aswell, they decided to offer me a position as an employee!!

There should be no grey area here.

in my case it was justifiable revenge.

Ahhh, thats more like it - Revenge!!

[effortless]

I have been involved in summat similar from the otherside. The difference was that the taxman was the one arguing not the employee or the employer. The rules do seem to have changed but the taxman says that they haven't. He says that the rules weren't properly enforced before. The argument came down to this. If you work thirteen weeks for the same employer, if you do not control when you work, if you do not arrange your own work, if you do not supply materials or if you are not a limited company then you are employed.

In the end the employer had to find the national insurance and tax for fifteen people, this backdated to the company's financial year. They were lucky to have negotiated this since some of the chaps had been on the strength for years.

This is, as far as I can see, a result of building industry abuses.

[tonker]

I think what David is saying is that he was self employed, but due to his length of service he should have some employment protection etc. I think as an industry and country, we sell ourselves very short in ths area
.
No matter his contract or status, this job is not only his passion, but how he feeds his kids. In 2007 we need much better rights and conditions in this area. I wonder how his fellow airman would react in France for instance!

It's very sad people getting on this guy's back, when he's just written a heart felt letter after loosing his job doing something we are all meant to love.
As far as Ray Price leaving aswell, i knew Ray a few years ago and found him honourable, honest and very much an aviation enthusiast. Probably why he's fallen out with the management.

I hope if we all met in a club sometime the views expressed about David's job loss, would to his face at least be a little more charitable and dare i say...airmanlike.

[IO540]

Skydriller

This is not a comment re Sherburn (of which I know nothing) but the situation can be poorly defined in practice.

Normally, if you employ somebody under a (mutually agreed, obviously) self employed arrangement, then you must get a commercial invoice from them for their services. You then pay that invoice just like you would pay any other arms-length supplier.

If you have a "self employed" person working and they are paid monthly, regularly, etc then the whole thing is liable to be opened by HMRC.

It also enables the employee to pretend they were conventionally employed all along, and the company is then deemed to have paid everything net, and the payments get grossed up and the company has to hand over the PAYE on the whole lot!

There is more to this than the above of course and the determination of status is done according to a number of indicators. These include regularity of payments, how many other suppliers the person provides their services to, the absence of any contract or any other form of job security (this is essential), etc.

Many years ago, loads of people were self employed in a manner which would not hold water today. Whole engineering companies and whole building sites would not have a single employee on them!

[Say again s l o w l y]

The whole self-employed FI thing is a real can of worms that is only just being opened.

I have some experience with these sort of problems and I have to say, even though you are self employed your length of service is more important.

Were you "employed" there for more than 12 months?
Were company procedures followed for your dismissal?
Are there any procedures?
Were warned about your conduct before?
If you were sacked on the spot, therefore it must have been gross misconduct. Was gross misconduct laid down in the company handbook?
Did they have a company handbook?

If Sherburn is like all other clubs I've been involved, then the answers are liable to be no except for the length of service.

Sherburn are likely to get absolutely slaughtered on this unless they can answer yes to all these questions.

Tribunals are usually won or lost on procedural matters, not right or wrongs.

[skydriller]

Thanks for the info IO540.

Maybe I am not the norm, but I have always insisted on contracts for either Regular Employment or Contract / Self Employment work so I and the company I work for understand the deal.

I therefore find it hard to believe that in the examples mentioned previously in this thread that both parties didnt agree before any work commenced what the deal would be - regardless of if there was an actual contract or not!!

Regards, SD..

[Say again s l o w l y]

Unfortunately this industry is run on the most part by people who have absolutely no idea how to run a business properly.

Self-employed FI's have long been a dodge to try and keep costs down. It's no wonder HMRC are looking at this closely.

If you teach part time on a non-regular basis, then fine you should be self-employed, but for most FI's they should be employed and it is only because it is easier for clubs/schools to dictate self employment status on thier staff. It gives more latitude for acting badly aswell.

This is being looked at very closely at the moment by numerous agencies and if it falls against the clubs, then there may well be a fair few going under, since they would be liable for all the employer's NI contributions that they haven't paid.........

[IO540]

Well you know and I know that everybody knows whether they are SE or on PAYE.

The question comes down to what an employer has to do to protect himself from somebody who decides they "misunderstood".

A colleague of mine recently sacked an employed salesman over expenses fraud - he was claiming his private mileage on business. This was disallowed in his contract. The salesman won at the tribunal by claiming that nobody explained to him the difference between business and private mileage Cost to the employer was £26,000. In fact the employer had top notch legal advice all along, paid for by his insurer, so this was no amateur doing it.

A SE person should have no job security whatever; basically this means no employment contract except perhaps a purely commercial one e.g. a purchase order covering the goods/services supplied.

One of the other indicators is whether the contractor is using his own equipment (good) or using equipment belonging to the company (bad).

[Say again s l o w l y]

In the case of an FI, nobody would choose to be self employed, the only benefit is that you can leave when you wish. Fine if you're after an airline job, but not much use if you aren't.

Clubs have dictated to FI's their employment status, rather than the other way round. I personally think that it's a ludicrous situation and the sooner it's sorted out the better.

FI's should enjoy the same protection as other employee's and clubs should start to be run properly, that way we may actually get successful long term business in this sector.

Spenkey, do you want some salt and vinegar to go with that chip?

[IO540]

Not sure I would agree with "nobody would choose to be self employed" in the general case.

A lot of people like the freedom, importantly the reduced NI contributions (what's the basic state pension worth, anyway, against building up your own investments?), the ability to concurrently freelance for other companies, etc.

SE also enables a lot of things to be offset against your income tax, like travel costs from your home to the site you happen to be currently working at - something that is absolutely prohibited in the PAYE case and which can be worth a great deal of money.

This is a controversial statement but (as someone who has employed many people over 30 years of being in business) I think that good smart resourceful people generally prefer SE and the less good and less resourceful prefer the security of PAYE and the ability to sue if they get the push.

I don't really know anything about GA flying instructors but I've met a fair few; many were on a £10/day retainer and some were on a zero retainer. I am sure they would have all preferred a PAYE position on £35k with BUPA chucked in but few flying schools can afford that, knowing that the FI is going to leave the moment he gets an airline job. There lies another paradox: if a PAYE person gets the boot he can sue for all sorts of things (after the first year, and at any time if he can allege certain things) but if one day he simply walks out the employer cannot do anything and still has to pay the person for time actually worked right up to the last day.

[Say again s l o w l y]

Generally IO, I would agree with you, but not in the FI case.

Yes, we'd all love £35k for being a PPL FI, but isn't likely to happen anytime soon, but with the dodgy practices that abound in this industry I would far rather have the protection of being employed than not and get paid a bit less.

I've never been offered the choice of employment status as an FI, even though I have managed businesses, employed staff, had my hours dictated.

As an FI I have never had the benefit of sick pay, holiday pay, employment protection or any of the other things a PAYE employee gets as a matter of course. I have also never been offered a contract of employment of any kind despite asking for them or even offering to get them written up. When I do consultancy work or freelance flying for reputable companies, then there is always a contract drawn up and there is no doubt about my employment status.

When everything goes well, then there is usually no problem, but what if there is an incident, or someone get's hurt under your supervision. Most FI's have their own liability insurance, but many don't. So who get's sued?

There are many things like this that should never be an issue and the basic thoughts on whether you are employed or not are easy to find on the internet.

I remember bogbeagle posting about employment status before, so I will be very surprised if the tribunal doesn't find in his favour.

[skydriller]

A lot of people like the freedom, importantly the reduced NI contributions (what's the basic state pension worth, anyway, against building up your own investments?), the ability to concurrently freelance for other companies, etc. SE also enables a lot of things to be offset against your income tax, like travel costs from your home to the site you happen to be currently working at - something that is absolutely prohibited in the PAYE case and which can be worth a great deal of money.

Dead Right. Thats why I have done it in the past, even though currently I work for a company as an employee (though internationally, so its not really like PAYE).

Well you know and I know that everybody knows whether they are SE or on PAYE.

Exactly.....
.........And in the case of this thread starter, both he and the aeroclub must have known what the deal was at the outset. In my simplistic view, knowing next to nothing about UK GA Instructors or the flight training business, one of the parties is telling porkie pies.

Regards, SD..

[Jodelman]

It has been said that you should know if you are an employee or self-employed.
I wish it were as simple as that. There is a huge raft of case law on this subject which is a minefield to explore - many barristers have made a good living from it!!

[IO540]

I've never heard of somebody who thought they were PAYE being declared as SE. That would be quite suprising.

Maybe there are marginal jobs which are unclear. I was suprised to learn the other day that you can be paid purely on piece rate (i.e. paid nothing if you do nothing) but still be PAYE and have all the rights. This feels completely perverse, and that's before you take the NMW into account (for somebody on piece rate!!).

The other way round, a SE person being regarded as PAYE, usually against their wishes, is not unusual.

S.A.S. - if you are SE rather than PAYE, you don't get sick pay but you will get extra money instead. That's the deal. So, the ultimate benefit of PAYE has to be the security of being able to sue. Given that any half decent employment lawyer is about £200/hour, wow much would you bother to sue for? 5k, 10k, 20k? IMHO 5k is not worth suing for. 20k will tip all but the big flying schools into liquidation; you can get the judgement OK but collecting it will be something else.

So, job security in this business is likely to be illusory.

[Say again s l o w l y]

If someone is offered a job on the understanding that they are to be self employed, then fine, but only if the job is truly a self employed position.
In the case of most full time FI's I would argue that they are really PAYE posts and are forced into self employment in order to save clubs money and ease their burden as an employer.