How best for an EU company to employ someone in the UK?

October 26, 2007 2:44 AM

UK employment/company law. How best for an EU company to employ someone in the UK?

There is a multinational, with European HQ/manufacturing in Italy. Some employees work remotely, including one employee in the UK. I'm given to understand that the Italian company cannot employ someone directly in the UK. Is this true? If so, what is the most cost effective manner to employ this person in the UK, while retaining the job security of an employee?

posted by Jakey to work & money (4 comments total)

If said person is selfemployed and has VAT number he / she can then be contracted by the Italian company and bill accordingly as agreed. Self employed person is responsible for their own Social security payments and Tax. Obviously he / she will calculate this into agreement.
posted by adamvasco at 6:27 AM on October 26, 2007

The employee can indeed be on the payroll of the Italian company in Italy.

However, since the employee is domiciled in the UK, the Italian company should pay him in full without making tax or social security deductions. The employee is responsible for paying tax to the Inland Revenue. Under this arrangement the employee has the same employment rights as her Italian colleagues under Italian law. These are worthless, of course, unless she's also prepared to go to Italy and defend them with Italian legal representation in an Italian court which speaks only Italian.

The employer may, additionally, be responsible for telling local tax authorities about the employee so that the Italian revenue service can inform their UK counterpart through channels. Or it may not.

It's almost certainly less annoying all round to be self-employed and invoice the Italian company instead, however.
posted by genghis at 7:34 AM on October 26, 2007

Oops.

s/her/him or s/him/her, according to taste.
posted by genghis at 7:35 AM on October 26, 2007

Thanks, guys
posted by Jakey at 3:55 AM on October 29, 2007