Monday, 2 February 2015

That's not employment, its just unpaid work

I've been having an ongoing problem with the new manpower returns since their introduction.  The latest twist was to get an e-mail confirmation of successful submission , despite the error below, and then followed up by a call from someone at the population office telling me in so many word that I hadn't submitted the form.  I also rather resent being called client by them. Do they know in its primary meaning it refers to a dependent, one who is under the protection of another? 

My ongoing problem isn't really about the technology. It is rather more about the lack of analysis or comprehension of  the distinction between work and employment.

I have run my company for over 25 years, and until the recent change never had any problem with the manpower return.  In the previous incarnation the return asked for data to be supplied based on hours worked (to distinguish part time and full time workers), and on a few other residency/5 year qualification etc.  Simple stuff.  It also was quite clear about working principals had to be included. That is the important bit, because a principal (ie an owner) does not have to have a contract  with a company they own, and is not necessarily an employee.  If they don't take a wage/salary or any other emolument and have no contract they cannot be an employee. That is how I have run the company for some years. 

Under the new form however it is not possible to make a return for a trading company without including the details of at least one employee. It uses that terminology, and requires a social security number and the type of employment contract (full/part/zero hours).    The instructions are clear that self employed people should complete the form - no problem if they are taking an income from the business. But what if the only person is the owner, and they are not remunerated or have a contract?

It gets even more bizarre if the company, as mine has, operates more than one business.  In this case it seems the only way to make a submission is to be employed in each company.  Goodness knows how many fake part-time or zero hour employment contracts have had to be entered by non-employed (at least in that business) principals just to get the forms submitted.

I cannot work out if the problem is a serious analysis failure, or a genuine incomprehension at the distinction between work and employment.  Anyone is free to do work gratis. How can it be otherwise?  If there is no pay or emolument and no contract it is not defined as employment (which is strictly the legal form of a master/servant relationship).  If it were not so  all those honorary police would have to appear on the parishes' manpower returns and all those charity shops would have to be filling in details of all their volunteers.

It is true that a Jersey company (not a business!) really ought to have a resident director, so there likely will aways be one person who ought to make a return of working  at the company level.  In fact if you read the new law on housing and employment even this is questionable for 'regulated' entities - since a non-resident director of one of  those can work in the Island for 10 days, sometimes longer, without having to register or do almost any of there things everyone else does under the Control of Housing and Work law 2012.  So a resident director could in fact do no work and hence not be required on the form.

If you are wondering, yes it is possible to have a business where no one is employed.  Many entrepreneurs would consider that a perfect model. You can outsource almost everything.  It costs of course, but it is perfectly legal to do so.   If what you trade is information or documentation it might be quite feasible to do that on a web site that once set up needs  no actual manual intervention.  It is one reason I don't fully subscribe to the view that promoting business will increase employment.  It aint necessarily so!

I can understand the desire to ensure people don't improperly slip through the system, but the administrative process really should be able to deal with the reality of the legal status of voluntary working principals.  It shouldn't even require that much work on the return forms and database.  The only reason I can see for collecting the data asked for is to check social security payments.  However even that is not quite right since if a director is paying class 1 contributions, there is no class 2 to pay.  Similarly if they over the pension age, self or unemployed there is no contribution to pay.

If my sources are correct this manpower return system was written by an outfit in Southampton.  Just perhaps it would have been wiser to have commissioned  one of the competent local software companies which might actually understand the local law.

1 comment:

  1. Caroline Hathaway2 February 2015 at 20:15

    You make some very good points, as I am a self -employed person and hate this silly obligation to do, because nothing ever changes with my business. I'm glad I'm not the only one who can't understand why the form is written as it is and wonders really what value is gained.