Freelancers — Who is Responsible for What?

Research by the IPSE suggests that self-employment is continuing to increase in popularity; as of September 2017 there were more than 4.8 million self-employed people working in the UK, approximately 40% of whom were freelancers. As more people move toward this way of working it is more important than ever that the rights and responsibilities of freelancers are understood.

Your rights as a freelancer

• You are legally protected by the terms of your contract with your client.
• You are entitled to be paid for work you’ve done.
• You have a right to a safe working environment. 
• You are protected against discrimination in the workplace.

Note that as you are your own boss you are not covered by employment law, nor do you usually have a right to things like sick pay or legal protection under your clients' company schemes.

Your responsibilities as a freelancer

As a freelancer, you are responsible for running your business and for its success or failure. This means that you are usually wholly responsible for the job you’ve been hired to do and that any liability is your responsibility. You’ll need to insure your business to protect yourself against worst-case scenarios. Freelancers typically need the following coverage:

Professional Liability Insurance

This is the most common type of insurance for freelancers, and is suitable for anyone from consultants to physiotherapists. Compensation claims have no legal cap in the UK so a single mistake could prove to be expensive. With professional liability insurance you'll be covered against claims of negligence, libel or slander, and the costs of any legal counsel you may need.

Public Liability Insurance

This is an important type of insurance for those whose work puts them in public contact. Although public liability insurance isn't a legal requirement for freelancers it could protect you should a member of the public sue your freelancing business. It will help cover injury claims and property damage, and is highly recommended if your work ever poses a potential risk to your clients or the public.

Employers Liability Insurance

As your freelancing business expands you may take on employees. If this happens it is legal requirement in the UK that you have employers' liability insurance. This covers you against claims made by your employees should they injure themselves whilst working for you or become ill as a results of their work.

Other trade insurance you may need

As a freelancer your work can put you at a greater risk of an insurance claim and you may require further coverage, such as:

• Home Business Insurance - If you work from home your house insurance may not cover your business. This speciality insurance will protect your building and equipment against theft and damage.

• Professional Consultants Insurance – Consultants are at the greatest risk of civil liability claims, which means you need professional indemnity and coverage against things like libel and slander.

• Construction Insurance – This insurance covers freelance contractors in the construction industry against public and product liability, among other common risks.

Things to remember

There can be a lot to remember as a freelancers so we've put together a handy checklist of things to keep in mind:

• Register as a sole trader with HMRC.
• Track your sales and expenses.
• Complete an annual self assessment tax return.
• Pay income tax on your profits.
• Register for VAT if you earn more than £83,000 in a given year.
• Register for the construction Industry Scheme if you’re a freelancer in the construction industry.

To ensure you are protected as a freelancer, read more about our self-employed insurance or call us on 0344 346 0409

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