Contractors must not be ‘part and parcel’ of the client’s business as if they were one of their employees. They should not be on any internal lists of employees or have business cards showing their client’s name and, crucially, must not be entitled to any benefits offered to the client’s own staff, i.e. bonuses, pensions, and use of facilities such as a gym.
Any clauses that stipulate that a contractor will be subject to performance reviews or disciplinary action (as would be expected of employees) would cause a contract to fail an assessment.
Right of Dismissal
It is not normally the case that a self employed person could be dismissed other than if he was in breach of the terms of his contract. An employee would have the right to be given statutory notice of the termination of his employment. HMRC see notice periods as being indicative of employment however reasonable notice periods are considered defendable.
If a contractor is not able to terminate their contract early, or has a notice period in excess of one month, the contract will fall inside IR35.
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