Self-employment

Employee, worker or self-employed? 

Your employment status dictates your rights and entitlements, and determines your employer's responsibilities.

Confusion can arise because employment status can be different under tax law and employment law. It is possible that you may be regarded as self-employed for tax purposes by Her Majesty's Revenue and Customs (HMRC), but as a worker or an employee by an employment tribunal (industrial tribunal in Northern Ireland).

At Gov.uk you can read more about working out someone's employment status, i.e. worker, employee or self-employed.  For the purpose of tax, see the HMRC's Employment Status Indicator (ESI) tool.

If you are self-employed, your rights and responsibilities are set out in the contract for services you have with the other party. A self-employed person does not have the same employment rights and responsibilities as an employee.

As a self-employed person the RCN is unable to provide you with workplace representation, nor do we support civil breach of contract claims that are worth less than £10,000 in England and Wales, and £3,000 in Scotland and Northern Ireland.

A tribunal or court can make a final decision on employment status. They will look at the employment relationship in practice between both parties, including: 

• Whether the company is under an obligation to provide you with regular work and you are under an obligation to make yourself available to do the work.
• Whether you are required to provide your services personally. Can you appoint a substitute or do you need the company's approval?
• Whether you are under the control of the company to such an extent that the company is your 'master'. In other words, the company controls what you do, how you do it and when you do it.

The number of RCN members who are choosing to work as nurse entrepreneurs is increasing and all the indications are that - given the current and proposed developments in health and social care particularly in England - these numbers will continue to rise.

You should always seek expert advice on which legal business structure is right for you. You may also need to source ways of developing your business and marketing skills. Go to Gov.uk for information on how to set up a social enterprise, start your own business and self-assessment tax returns.

The types of paperwork you need to keep will depend on the type of business you are running and who you provide your services to.

The following organisations provide independent and impartial advice and can answer questions on how to write a business plan, plus starting (and running) a business.

England - National Enterprise Network
Scotland - Business Gateway
Northern Ireland - NI Business Info
Wales - Business Wales

Before you start work as a self-employed professional, we would recommend you find out how the arrangements will work in practice. In particular, clarify (and keep written proof of) the following:

• how long the contract will last for, or if it is open-ended
• arrangements for booking/cancelling work
• where you are to undertake the work, and for whom
• who is responsible for providing the equipment you’ll need to provide your service
• how you’ll be paid, and how often
• how you are to pay tax/National Insurance and other standard deductions
• substitution clauses/requirements – can/will you arrange someone else to carry out the work on your behalf if you can’t do it personally? 

There are no specific legal or professional restrictions to setting up in private practice and offering the services as a registered nurse or midwife. Of course, you will remain bound by the standards set by the Nursing and Midwifery Council (NMC) in the Code. 

"You must make sure that any advertisements, publications or published material you produce or have produced for your professional services are accurate, responsible, ethical, do not mislead or exploit vulnerabilities and accurately reflect your relevant skills, experience and qualifications."

As a registrant you are required by the NMC to confirm that you have appropriate indemnity cover arrangements in place to cover your practice.

If you are self-employed you are likely to need to have your own indemnity arrangement in place. 

It is your responsibility to ensure that you have sufficient cover in place which reflects the risks associated with your scope of practice. The cover that you have in place should be relevant to the risks involved in your practice so that it is sufficient in the event that a claim is successfully made against you.

If you are genuinely self-employed then the RCN indemnity scheme may apply as long as you meet the scheme's terms and conditions.

Remember, the success of your business may depend on maintaining your professional reputation and registration. You must not do anything that could jeopardise standards of practice or put your clients/customers/patients or NMC registration at risk.  

Several organisations now run training courses for nurses who wish to work as expert witnesses. For example, an organisation called Bond Solon Training offers two day training courses in report writing and courtroom skills for nurses called 'Nurse Expert Training'. 

The RCN indemnity scheme may cover you in your self-employed capacity as an expert witness, however, your business/service will need to meet the conditions of cover. Read more about our scheme here.

You may find it useful to visit and join the RCN Nursing forums. By contributing to the online community of your speciality, you can seek guidance from RCN members working in your field.

The following organisations provide independent and impartial advice and can answer questions on how to write a business plan, plus starting (and running) a business.

England - National Enterprise Network - tel: 01234 831623
Scotland - Business Gateway - tel: 0845 609 6611
Northern Ireland - NI Business Info - tel: 0800 181 4422
Wales - Business Wales - tel: 0300 060 3000

Nursing and Midwifery Council

HM Revenue and Customs (HMRC) - the HMRC Employment Status Indicator (ESI) tool can be useful for checking your status. HMRC may regard you as self-employed for tax purposes, but you could still have a different status in employment law. If in doubt please seek legal advice.

HM Courts and Tribunals Service - some claims for a fixed amount of money can be started at the Money Claim online website.