Opinions on contracts: formal decisions and rights of appeal
Regulation 6(4) SI 2000 No. 727
Section 8(1)(m) Social Security Contributions (Transfer of Functions, etc) Act 1999
There is a statutory power (under the NICs Regulations - SI 2000 No 727) to make a section 8 decision that a relevant engagement is covered by the new rules. This has effect from 6 April 2000. This decision has a right of appeal to the First Tier Tribunal .
If you complete the fact-finding process and the worker still does not agree with your opinion that a relevant engagement is covered by the legislation he or she is not obliged to accept it. You may be asked to make a formal decision. The wording of section 8 decisions must follow the prescribed format shown in the Decisions and Appeals Guide (DAG) - see Intranet under “Guides”. A NICs decision under the intermediaries legislation is no exception so in all cases where it is determined that the relevant engagement is covered by the legislation you should use the wording at ESM3297 for your decision.
The Notice of Decision (DAA1) is a legal document which reflects the requirements of the Social Security Contributions (Transfer of Functions etc) Act 1999 and the intermediaries legislation. The notice consists of:
- the notice which is issued to the worker/intermediary - (DAA1(A)
- the notice which is issued to the other party named in the decision - (DAA1(B)
- a copy of the notice to keep with the working papers - (DAA1(C)
- a copy to keep centrally - (DAA1(D)
- a copy for the agent where there is one - (DAA1(E)
- a payslip where, as a result of the decision, payment is due to the Revenue - DAA1(F)
A section 8 decision must state the name of every person in respect of whom it is made. Any person affected by the decision should be named in it. This gives them a right of appeal on any matter that affects them personally and means they are bound by the final decision. This does not include the client who may be named in the decision but would not suffer or enjoy any consequence as a result of the decision by payment or non-payment of contributions.
Guidance for completing the notice of decision is given in the Decisions and Appeals Guide (DAG).
There might be circumstances when having given a section 8 decision that an engagement was covered by the legislation you need to give a varied decision that a worker was not to be treated as an employed earner. For example following an appeal against an adverse decision where evidence is presented which allows the decision maker to vary the decision before any appeal is heard. In these circumstances you should use the wording in ESM3298.
The guidance at ESM0112 should be followed where an appeal against a formal decision is made to the First Tier or Upper Tribunal.