130: HMRC loses football referee employment status case

The First-tier Tribunal has held that, for tax purposes, lower division football referees are not employees of Professional Game Match Officials Limited (PGMOL), the representative body which oversees the management of refereeing of professional football. Although this case deals with employment status under tax law, which is separate from employment law, there is significant overlap in the relevant principles.

PGMOL engages 60 referees on a self-employed basis to officiate for lower division football matches. A dispute arose because HMRC issued income tax and national insurance assessments on the basis that the referees were employees of PGMOL. Applying the key tests for employment status set out in the case of Ready-Mixed Concrete (South East) Limited v Minister of Pensions and National Insurance, the First-tier Tribunal agreed with PGMOL that the referees are self-employed. Key findings included:

• the working arrangements lack mutuality of obligation. Although PGMOL’s Code of Practice requires referees to be readily and regularly available, this is in practice more of an expectation since both the referees and PGMOL can withdraw from engagements at any time without being in breach of contract. In addition, there is no right of substitution;
• the necessary framework of control is lacking. Referees are required to adhere to PGMOL’s Match Day Procedures, Fitness Protocol, and Code of Conduct. However, they are not obliged to follow a specific training programme or attend training meetings; they can express geographical preferences for matches and refuse appointments; they have full authority on match day; and regulatory breaches are dealt with by the Football Association, not PGMOL.
• the arrangements do not otherwise suggest an employment relationship, although there are some factors which point towards employment. For example, the referees are integrated into PGMOL; PGMOL is primarily responsible for paying them; they are supplied with match and training kits, and suits to be worn to games; and they cannot obviously be described as being in business on their own account.

This case highlights how difficult it can be to definitively assess employment status. Whilst acknowledging that some aspects of the arrangements in this case point towards an employment relationship, the First-tier Tribunal concluded that there is insufficient mutuality of obligation and control and confirmed that referees can therefore be taxed on a self-employed basis. For employment law purposes, however, PGMOL has agreed that referees will have ‘worker’ status in future football seasons.