Experts warn NHS 111 in HMRC's cross hairs following referee legal ruling
As the Government issues a rallying cry to the nation to help fix the NHS, senior health and tax experts have warned that a legal ruling that decides whether football referees are employed and not self-employed will raise critical questions about employment flexibility in healthcare and across the NHS — and “could be catastrophic to both the health service and the public”. The warning comes as three NHS 111 providers wait to go to tribunal.
Following the UK Supreme Court dismissing an appeal by the Professional Game Match Officials Limited (PGMOL) last month challenging a £584,000 tax bill imposed by HMRC, there are growing concerns that out-of-hours doctors working for NHS 111 could be next to appear in the fiscal cross hairs.
The NHS cannot afford to employ all the doctors needed to run NHS 111. The doctors are currently all engaged off-payroll by private companies. If, as it did with PGMOL, HMRC argues that the doctors have been working under a contract of employment then they, NHS 111 and even the NHS itself could be liable for significant tax bills, potentially putting further financial strain on an already struggling health service.
Speaking to the Newspage news agency, Rebecca Seeley Harris, CEO at Re Legal Consulting, said: “The next round of the PGMOL case in the First Tier Tribunal could be a game-changer for those engaged off-payroll and that includes IR35. It could also have far-reaching implications for the provisions of private services to the NHS. This could be significant for both out-of-hours GPs and, more generally, all clinicians and pharmacists and, in fact, other industries."
Conor Burke, Chief Executive at Urgent Health UK, added: “A legal ruling that decides that football referees are employed and not self-employed will raise critical questions about employment flexibility in healthcare and across the NHS and could have a significant impact on the delivery of NHS services. Thousands of GPs work in GP out-of-hours services across England on a self-employed basis, and a change in their employment status may cause them to reconsider providing these critical services. This would further strain an already overstretched NHS and could compromise patient care during nights and weekends. While the ruling specifically addressed employment within professional sports, its ripple effects are being felt across multiple sectors, including the NHS. Out-of-hours GP services operate on a delicate balance, often relying on locum and self-employed doctors. If they are reclassified as employees, we risk a significant reduction in the workforce willing to cover these shifts, leaving gaps in essential services. NHS GP out-of-hours services play a vital role in patient care and depend on flexible working arrangements to function effectively. If we don’t address these legal uncertainties now, we could face a real crisis in service delivery with patients finding it increasingly difficult to access critical services. The government must urgently address the critical risks to workforce and patient care that a change in employment status would pose.”
Michael Cleavely, Founder at CoComply, is also concerned that a ruling targeting referees could impact the crucial health services the public needs: “The UK economy is dependent on the flexibility of contingent labour. Whether it is GPs providing out-of-hours services or IT contractors providing infrastructure support, UK plc needs to be able to utilise these workers. The problem is that tax compliance in the form of IR35 and off-payroll rules are making it incredibly difficult. If the PGMOL FTT come back and say that the football referees are employed, this could impact the ability for the NHS to be able to provide these services."
Seeley Harris said that while HMRC is simply doing its job, the impact on the health service and those who rely on it could be devastating: “Although HMRC is simply following established employment status case law, it doesn't mean that it will win. Unfortunately, this puts a lot of stress on the public services and they don't have an exemption where tax compliance is concerned but, in this particular circumstance, it could be catastrophic to both the health service and the public.”
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