Medical Practitioners - Contractors or Employees?

Introduction

A contract of service typically refers to the existence of a typical employer-employee relationship. A contract of service itself, is more commonly known as a contract of employment. 

A contract of service refers to the provision of a service by one party to another, without the existence of an employer-employee relationship.

Under a contract for service, the person providing the service is typically self-employed.

Very often, members of the medical profession will prefer to have a contract for service to afford them flexibility in how, when, where and whom they provide their services.

However, what happens if a medical practitioner believes that the relationship is more akin to the typical employer-employee relationship, despite the existence of a contract for service? Will that medical practitioner be in a position to avail of certain provisions or rights afforded to ‘typical’ employees under the various employment legislation?

Determining Employment or Self-Employment

The case of Dr Sheila O’Meehan -v- HSE (UD/19/127), is useful in determining the criteria the Workplace Relations Commission and Labour Court will consider when examining whether a medical practitioner is an employee or a contractor.

In this case, Dr Sheila O’Meehan brought a case against the HSE under the Unfair Dismissals Act. Dr O’Meehan was an experienced general practitioner who worked on a part time basis for almost 3 years at an addiction clinic in Crumlin, Dublin. This clinic came within the remit of the HSE. Dr O’Meehan also occasionally provided GP assistance at clinics in other locations during that period.

The HSE contended that Dr O’Meehan was, at all material times, an independent contractor and not an employee. Therefore, they argued the Unfair Dismissals Act should not apply to her.

Burden of Proof in Determining Employment Status

In situations like this, the burden of proof is on the individual bringing the complaint to demonstrate that they are entitled to pursue a complaint under the relevant Act.

Dr O’Meehan told the Labour Court that she was a PAYE employee of a company called “Winton Medical Limited” which was established by a firm of accountants to facilitate payments to a number of locum general practitioners. Winton Medical Limited, in return, retained 5% of the general practitioner’s income.

When working for the HSE, Dr O’Meehan was paid €60 per hour.

Dr O’Meehan regularly worked between 8 and 24 hours per week for the HSE during the period in question.

Dr O’Meehan submitted copies of revenue documents showing her self-assessment balancing statements for the tax years between 2015 and 2018. It was accepted by Dr O’Meehan that she had never made an application to revenue or the Department of Social Protection, seeking a determination as to her employment status.

She also confirmed that she was not restricted from taking on other work in addition to the hours she worked for the HSE, during the period in question. She said she hadn’t done so because of the demanding nature of her work with the HSE.

It was later confirmed that Dr O’Meehan could take annual leave whenever she wished to do so. There was no need to give any notice to the HSE.

Assessing the Employment Relationship

Having regard to the evidence before it, the Labour Court found that Dr O’Meehan was neither engaged by the HSE on a contract of service nor as an agency worker at the material time, or at any time at all.

The Labour Court noted that, by her own evidence, Dr O’Meehan had knowingly structured her employment affairs with the intention of minimising her exposure to income tax and other statutory deductions.

Furthermore, the Labour Court noted that Dr O’Meehan was free to decline hours for which she had been rostered, she enjoyed full clinical autonomy and was not subject to supervision while conducting her clinics. There was no impediment preventing her from working elsewhere as a general practitioner, in addition to the hours she worked for the HSE.

Dr O’Meehan was also responsible for securing her own professional indemnity cover and could avail of leave whenever she wished to do so.

On that basis, the Labour Court determined that Dr O’Meehan was a contractor and not an employee.

Conclusion 

The takeaway for medical practitioners is that, if they do not have a contract of employment, pay their own taxes, set their own hours, enjoy relative autonomy, and can substitute their services, it is less likely they will be construed as ‘employees’ for the purposes of the various employment provisions.