Legislation introduced back in 2014, means that recruitment agencies are responsible for determining an individual’s employment status.
An SDC questionnaire focuses on ‘how’ the work is carried out by a worker and governs whether a worker is subject to (or to a right of) SDC or not. Should a worker be subject to SDC, then they must be placed on the payroll and are deemed as ‘employed’. They can only be paid as self-employed subcontractors if they are deemed to be operating without any supervision, direction, or control – or in other words if they genuinely act as a freelance worker who is not micromanaged and told how to undertake their work.
As a reminder, GOV.UK provides the following guidance on SDC:
Supervision refers to someone overseeing another person who is carrying out the work to ensure that they are doing it and that the work is being done correctly. For supervision to apply, a worker could be seeking advice or assistance from someone else to develop their skills and knowledge.
Similarly, direction refers to someone forcing a worker to do their work in a certain way by providing them with instructions, guidance, or advice as to how the work must be done. This could often involve someone co-ordinating how the work is done.
Finally, control is seen as someone dictating the work that an individual carries out and how they go about completing it. When an individual is self-employed, there should be an absence of control over how, what, when and where their work is performed (aside from site safety restrictions and project logistics).
It is important to note that a contractor doesn’t need to be subject to ALL three of the above to be considered ‘under SDC’. For example, a contractor may not be directed or controlled, but if they are supervised, or if there is the right of supervision, then SDC applies.