The trinity of the irreducible minimum of three factors to consider when making a decision on employment status are the first priority, but it has also been shown that the overall picture is also to be taken into account.
This overall picture takes into account the following factors:-
a) Being in business on your own account
This is a test that involves a client's attitude or mindset. Does the business look real? Does it have the constituent parts of a business? Does the worker think of themselves as being in business?
All these are important as are factors such as the use of business cards, having an office space, the correct business insurance, investment in training, retention of profits for "on the bench time", data protection registration or even ISO9000 accreditation, having a company website, company promotions, being vat registered, keeping accounts and demonstrating that you are managing your own business.
b) The intention of the parties
HMRC give guidance on intention at ESM 0554 agreeing that the intention of the parties should be taken into account with all the other general factors, especially in borderline cases.
c) Provision of equipment
This can play a role in the general factors to consider but is less relevant where we are considering knowledge based workers, and where security is an issue and the provision of equipment is immaterial.
d) Freedom of supply
A person who is really running their own business is likely to have freedom to supply whom he wants and not be tied down in contracts like an employee not restrict the provision of his services.
This may be immaterial in some business sectors where confidentiality and security take preference, but in general terms a freelancer in business on their own account may be supplying several parties at the same time, and will be less confined than an employee.
e) Financial Risk and chance of profit
In a practical sense this may mean putting defective work right, or giving a fixed price for a job.
f) Part and Parcel
A freelancer running their own business will not be part and parcel of an organisation, whereas an employee will.
A freelancer will not be managing the organisations employees, and will need to maintain an internal identity as a contractor rather than an employee. An employee will have access to the staff canteen, a freelancer probably will not, nor will they benefit from the same subsidised meal rates as an employee.