Kate Field

IntroductionThis Practice Note considers the Irish employment status issues that arise when a company engages an individual consultant. It explains the legal position following the Revenue Commissioners v Karshan (Midlands) Ltd t/a Domino’s Pizza, the five-step framework for determining employment status, the relevance of Office of the Revenue Commissioners (Revenue) and Department of Social Protection (DSP) guidance, the potential impact of Directive (EU) 2024/2831 of the European Parliament and of the Council of 23 October 2024 on improving working conditions in platform work (EU Platform Work Directive) and the practical consequences of reclassification.The status analysis is relevant because the consultancy agreement should support that status, however the written label is not decisive. Irish courts, the Office of the Revenue Commissioners (Revenue), the Department of Social Protection (DSP) and the Workplace Relations Commission (WRC) may look at the full working relationship and how the arrangement operates in practice. This Practice Note does not provide a clause-by-clause explanation of the consultancy agreement. It explains the employment status issues that inform the drafting

This Agreement is made on [insert date]between1[Name of client company] a company incorporated in Ireland with Companies Registration Office number [insert company number] whose registered office is at [insert address] (Client); and2PartiesThis agreement is between the two corporate entities. The individual consultant is not a party to the agreement, in order to avoid any direct contractual relationship between the individual and the Client.The parties have an interest in ensuring that the identities of both companies are properly specified in the agreement. If the consultancy services are to be provided through a limited company, it is worth doing a company search through the Companies Registration Office (CRO) to verify the company name and also to check the details of the directors.It is important to establish the type of legal entity of the Client company. In Ireland the types of companies governed by the Companies Act 2014 (Ireland) are Private Companies Limited by Shares (LTD), Designated Activity Companies (DAC), Companies Limited by Guarantee (CLG), Public Limited Companies (PLC), and Unlimited Companies. The most

This Agreement is made on [insert date]PartiesWhere possible, a client should consider engaging a consultant through a third party company rather than engaging them as an individual as the consultant is more likely to be perceived as providing services in their personal capacity. Following Karshan, the Revenue Commissioners has confirmed that it will not pierce the corporate veil and look behind the relationship with a contractor where they have been engaged to provide services through a third party company. However, the Workplace Relations Commission will still review the relationship and can make a determination that the relationship is akin to that of an employer/employee relationship. This Precedent, as drafted, gives the consultant autonomy as to how they provide their services to a company. However, the company should be mindful of how the agreement works in practice, as the Irish courts and employment tribunals will look behind the agreement to see how the relationship actually works on a day-to-day basis See further Practice Notes: Ireland—Implementing the Platform Work Directive (PWD)—reclassification and Article: Domino