ESM11045 - Check Employment Status For Tax: Personal Service - Hirer’s right to reject a substitute

CEST asks: ‘Does the client have the right to reject a substitute?’ or ‘Does your client have the right to reject a substitute?’

See ESM0533 for further guidance on the right of substitution.

A client will have the right to reject a substitute if:

  • the contract specifies that the worker will perform the work and is silent on substitution;
  • the hirer has an explicit right to reject a substitute;
  • the worker can only provide a substitute from a pre-approved pool of workers.

Substitution would not be practical or plausible if any factors exist which would make it unrealistic that a substitute could be provided. This could include timescales, the nature of the work or security restrictions.

Where it would not be practical or plausible for the worker to send a substitute, this would fall within the ‘Yes’ category for CEST.

A client will not have the right to reject a substitute if the contract specifies that the worker has an unconditional right to substitution, and it would be practical and plausible for them to send a substitute.

Where the hirer can only reject a substitute upon grounds that they are not qualified to perform the work, this would fall within the ‘No’ category for CEST provided it would be practical and plausible for the worker to send a substitute.

EXAMPLE

Charlotte is an interior designer working for a furniture company. She gives advice to customers on the best items to purchase for their home. Charlotte wants to send another interior designer to undertake her duties.

  • If the hirer has any right to say no, even if they do not on this occasion, then they have the right to reject the substitute.
  • If the hirer is unable to stop the other designer from undertaking Charlotte’s duties and substitution is practical and plausible, then they do not have the right to reject the substitute.
  • If Charlotte has chosen the other interior designer from a pre-approved list of designers, the hirer has had to approve all designers in that pool. Without this approval Charlotte could not send the person, so the client does have the right to reject a substitute.
  • If Charlotte is hired for 2 weeks and it takes 2 weeks to add another designer to the relevant systems to undertake the work, then it is not plausible a substitute can be sent. The hirer would be able to reject the substitute.