Department of Social Protection issues new code to assess bogus self-employment
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The Department of Social Protection has revised its code of practice for assessing bogus self-employment to include a 2023 Supreme Court decision concerning Domino's Pizza drivers for the first time.
The department, whose employment status unit incorporates both its Scope section — which rules on what manner of PRSI a worker should pay — and the social welfare appeals office — published a new code of conduct this week asserting the Supreme Court decision in the Karshan/Domino’s case was now the key factor in determining whether or not a worker is self-employed.
That new code of practice serves to overrule the previous code, which had stood since 2001 and which saw the use of limited precedential ‘test cases’ to determine whether or not whole tranches of workers were direct employees or self-employed.
The Karshan ruling of October 2023 said all delivery drivers for the Domino’s fast food chain are full employees, not self-employed contractors, and thus entitled to the full swathe of workers’ benefits such as holiday and sick pay and pension contributions.
The ruling has overarching implications for bogus self-employed workers — those doing the same work as a full employee but receiving none of the same benefits — across sectors, from couriers to construction workers to journalists.
Though the three public bodies responsible for adjudging worker status — Social Protection, the Revenue Commissioners, and the Workplace Relations Commission — had been relatively slow to take on board the Karshan ruling, that effectively changed last August when the WRC used five questions outlined in Karshan to decide definitively in the favour of musician Matt McGranaghan in his case against his former employer MEPC Music.
MEPC had refused to grant him full employee status despite the fact he had at one time played more than 200 events with the company a year. That case has since been appealed to the Labour Court.
The redrafting of the department’s code of practice for determining employment status is of particular note, as the previous iteration was relied on entirely by the social welfare appeals office in deciding upon appeals regarding whether or not someone was self employed.
When asked, a spokesperson for the Department of Social Protection acknowledged that its appeals office will now “have regard to the revised code and all relevant legislation and case law in its appeals also”.
“The code of practice is a living document which is updated to reflect changes in the labour market, relevant legislation and case law. It is intended to provide a clear understanding of the employment status of individuals,” they said.