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Employee status and voluntary workers: the dangers of rewarding your workers

Voluntary workers are a category of worker who perform duties for charities, voluntary organisations, associated fund-raising bodies and statutory bodies. They are distinct and have a separate definition to volunteers.

The lines between employees, workers, the self employed, interns and voluntary workers have become increasingly blurred and a contract detailing the status of a relationship between an employer and an individual is no guarantee that the employer will not later face a claim for unfair dismissal or unpaid wages. However, charities in particular have been able to take heart in the fact that the National Minimum Wage Act makes it relatively simple in the case of voluntary workers.

A voluntary worker is not entitled to the National Minimum Wage if the following conditions are met:

1 They receive no monetary payment other than reimbursement of expenses actually incurred or reasonably estimated as likely to have been incurred in the performance of their duties.

2 They receive no benefit in kind other than reasonable subsistence or accommodation.

The government even provides helpful examples of what would be reasonable expenses. A voluntary worker for example could be reimbursed for reasonable train fares to travel to and from their place of work. They can even, in some circumstances, be reimbursed for any costs that they incur in order to look after dependants (whether children or otherwise), to facilitate their voluntary work. Even providing training cannot interfere with a voluntary worker’s status, provided it is for the purpose of the voluntary work they are undertaking.

Whilst there are relatively clear guidelines for charities and other organisations to ensure that they are not faced with previously unforeseen legal obligations in respect of their voluntary workers, just subtle variations can alter the status of the relationship.

For instance, if an organisation provides training which has a wider benefit to the individual than just allowing them to conduct their volunteer work, then it would be viewed as a benefit in kind. Any childcare expenses need to be limited solely to those incurred in order to allow the individual to do the work. Any gifts, whether financial or otherwise, given to the voluntary worker could be viewed as either remuneration or benefits in kind. In all cases this would endanger the defined relationship and may result in the individual becoming a worker entitled to National Minimum Wage.

Practical steps

• Ensure expenses are for the purpose of doing the voluntary work and are only paid upon production of appropriate receipts.

• Have a clear gift policy for your organisation

• Ensure any training is actually necessary for the work the voluntary worker is carrying out and is limited in its scope.

 

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Legal news, views, trends and tools for HR Professionals. Stay ahead. Go further