Relevance of mutuality of obligation

For anyone looking at employment status and IR35 it will be difficult to ignore the controversy concerning the concept of mutuality of obligations commonly abbreviated to MOO. It is a widely-acknowledged aspect of employment law when determining a worker’s status and rights. However HMRC expressly ignored it when designing its check employment status tool (CEST) which is intended to assist taxpayers dealing with IR35 challenges in particular ahead of the roll out to the private sector of the revised scheme from next April. HMRC’s official position is that MOO is irrelevant when determining a worker’s status and that its application is limited to ascertaining whether there is a contract in existence at all.

Go – the starting point

When determining a worker’s status the universally-accepted starting point is the decision of Mr Justice MacKenna in Ready...