Particular trades: Hairdressing: Guidelines agreed with the National Federation of Hairdressers
[Important note: Not all of the guidelines have to be met in any given situation. They remain what they are called, guidelines. They are indicators of the type of relationship that exists and some (like employment status of the stylists; the agreement between the parties - whether spoken or written, and the way the money/takings are handled) will carry more weight than others. In any event, you should always read them in conjunction with the foregoing guidance on hairdressing, in particular VTAXPER68600.]
Intent and general principles
To establish a business relationship other than that of employer and employee with the intent by the parties concerned to control their own actions and destiny through observance of the following basic principles:
- each party to have ultimate command and authority over all aspects of their respective business or enterprise, and to be readily identified as having such authority;
- each party to be responsible for the finances of their respective business or enterprise, and to reap the rewards and losses arising therefrom;
- neither party to be solely obligated to - or rely or depend upon - the decisions of the other.
These guidelines support the above and will be used as a means of interpreting the intentions and principles of the parties concerned against their established working practises and procedures. The Guidelines are not exclusive but are indicators of the type of relationship that exists.
- The independent contractor (the Contractor) within a salon should be self-employed. An employee cannot establish an independent business within the establishment of the employer.
- The business or enterprise of the Contractor should be independent of, and separate to, that of the salon and:
- maintain its own books and accounting records;
- be responsible for its own taxation affairs, health and safety procedures;
- attend to its own insurance requirements, including public liability insurance;
- be capable of suffering losses (negative profit) as well as enjoying profits;
- have complete freedom to establish its own price structure and times of opening (including closure for holidays);
- purchase consumables and products from any source, and sell any product range;
- be able to compete openly for clients both inside and outside the salon, and to accept or reject clients at will;
- be free to appoint locum tenens as the need arises;
- be free of restrictions about the sale, disposal or relocation of the business;
- display a notice giving the name of the Contractor and address at which documents may be served as required by Section 4 of the Business Names Act 1985;
- respond to actions brought against it by third parties;
- have its own stationary for business letters, written orders, invoices and receipts.
- Ideally, there would be separate access to that part of the salon in which the business of the Contractor is situated.
- The Contractor to have access to their business at all times and have the ability to be open for custom at any time of their choice.
- The clients should be in direct contract with the Contractor and be fully aware of this fact.
- Complaints and claims from clients of the Contractor should be directed to the Contractor and not the salon.
- Separate appointments (where applicable) should be maintained by or for the Contractor.
- Casual clients entering the salon should themselves choose whether to patronise the Contractor or salon, and should have sufficient information to make such a choice based on:
- the name(s) and possibly portraits, displayed in the reception area;
- an identifiable list of specialities and price lists displayed in the reception area for each Contractor;
- the times to wait before receiving attention.
- The details, records, and addresses of clients who receive attention from the Contractor to be the property of the Contractor.
- The money received from clients attended by the Contractor to be the property of the Contractor, whether or not it is taken centrally.
- Money collected centrally should either be handed over to the Contractor or paid into an account held in the name of the Contractor.
- Money held for and on behalf of the Contractor, and the salon holding such funds should account to the Contractor for those funds.
5 Salon environment
- The salon should not exercise control over the Contractor, or impose upon the Contractor codes or standards relating to hygiene or behaviour unless applied equally against all parties with observance measured by an independent authority or peer pressure. Safety regulations imposed on the Contractor by the salon should be no more than that required to comply with current legislation.
- The Contractor to be responsible for the conduct, appearance and presentation of the Contractor’s enterprise, and in particular for behaviour, hygiene and safety matters relating to, or arising from, the Contractor’s activities.
- There should be clear agreements in respect of services provided by the salon including:
- the provision of telephone, heat, light and water;
- available accommodation for clients;
- reception, appointment booking and cash handling facilities;
- use of salon personnel for specific duties and the control and discipline arrangements for such personnel;
- use and availability of furniture, fittings and equipment;
- laundry services;
- marketing and promotion of hairdressing services;
- cleaning and washing of floors and equipment;
- access and security;
- the amount to be paid by way of rent for use of space;
- the amount to be paid for use of services, cleaning and maintenance of communal areas or how such charge is to be calculated.
- There should be a clear agreement in writing between the salon and the Contractor that accurately reflects actual working practice.
- There should be a clear statement in respect of the term of the agreement, and the obligations and responsibilities of the parties on termination, notice required on termination and where that notice is to be served.
- That VAT is to be levied (when applicable) on the charge paid by the Contractor for the services provided by the salon.
- The Contractor is responsible for insuring the enterprise against public and product liabilities, losses that could arise as a result of theft, fire, storm, accidental damage etc, and statutory cover in respect of staff retained by the enterprise.
Independent Contractor - a self employed person who provides an independent hairdressing and/or beauty therapy service to the general public from within a salon owned and operated by another person or company.