Substitutes and relief cover in a self-employed workforce: how to run substitution so it works in practice

• Substitutes and relief cover in a self-employed workforce: how to run substitution so it works in practice
  • Why substitution is an ops problem, not just a contract clause
  • Substitute, relief worker or reallocated work?
  • The 5-step substitute workflow
  • Make checks fast enough to be practical
  • Warning signs that a substitution right is only on paper
  • Relief pools: useful, but know the trade-off
  • Data you collect about substitutes
  • How software helps
  • Common questions
    • Can we refuse a substitute?
    • Who pays the substitute?
    • Does a substitution clause fail if nobody has ever used it?
    • What records should we keep about a substitution?
    • Does running a substitution process make our workforce self-employed?
  • Sources

# Substitutes and relief cover in a self-employed workforce: how to run substitution so it works in practice

Short answer. If your agreements let self-employed people send a substitute, your operation needs a way to handle one turning up. Run it in five steps: take notice, apply objective checks only, give the substitute access, settle who pays whom, and record what happened. Whether a substitution right is genuine, and what anyone's status is, depends on the facts, so use GOV.UK's employment status guidance and HMRC's CEST tool rather than relying on the process.

This is operational guidance, not legal or tax advice. No process can promise how a tribunal or HMRC will view a substitution clause. Checked against the GOV.UK pages and judgment listed under Sources on 14 October 2026.

# Why substitution is an ops problem, not just a contract clause

HMRC's employment status manual says a right to send a substitute must be genuine to count, and that a written clause will be ignored as a sham where the true agreement is that the work must be done personally. Its manual on personal service asks practical questions: who decides when to use a substitute, who recruits and pays them, and whether one has ever been used.

A 2025 Employment Appeal Tribunal judgment shows how that plays out. In BCA Logistics Ltd v Parker [2025] EAT 94, the employment tribunal had found that a substitution clause for self-employed drivers was not genuine, and the EAT dismissed the appeal. Among the points the tribunal relied on, as set out in the judgment:

• "there was no plan or process in place for what would happen in practice"
• the company "did not provide any training or guidance on how to engage and use a substitute"
• no driver had used a substitute in over 25 years

The EAT also recorded that a tribunal can consider whether the business had made any arrangements to deal with substitution and how practicable it would have been. That is a finding on one set of facts, not a rule for every business, but it shows that the questions are operational ones.

Couriers are one example. The same questions arise for cleaning, facilities, care and field-service teams.

# Substitute, relief worker or reallocated work?

Three different things often get called "cover":

Keep them separate in your records. Taking a job back and offering it elsewhere is not substitution, and calling it that makes your records less accurate.

# The 5-step substitute workflow

1. Notice. Set out in the agreement how and by when the person tells you a substitute is coming: name, the job, and the documents the work needs. Keep the notice period realistic for the work.

2. Objective checks only. Check only what the work needs:

   • the qualification or driving licence category the job requires
   • insurance that covers the person doing the work (confirm with your insurer what it requires)
   • vehicle documents, where the substitute brings a vehicle
   • a right to work check that you carry out yourself, before the substitute starts (see below)

   HMRC's CEST guidance says that where a hirer can only reject a substitute because they are not qualified to do the work, that falls in the "No" category for the right-to-reject question, provided substitution is practical and plausible. HMRC's manual on sham substitution clauses adds that requiring approval of a substitute in advance is not necessarily an unlimited fetter, while a right to refuse a substitute for any reason would be. Keep the reasons for any refusal to that kind of ground, and record them.

   Right to work is a separate legal check, not a choice about who the substitute is. From 1 October 2026, if you are contracted to provide the work, section 15A of the Immigration, Asylum and Nationality Act 2006 treats you as employing anyone who personally does it, including a substitute you have no contract with. The Home Office employer's guide says you only have a defence if, before the work starts, your process makes sure that a right to work check is carried out on every substitute, that the check is not left to the person who sent them, that no substitute works before their right to work is verified, and that the person doing the work is the person who was checked. Keep the record of each check.

   For driving work, the substitute creates a check code and you use it once with the last 8 characters of their licence number. The document re-check checklist covers what each document check involves.

3. Access and handover. Give the substitute what the job needs: app access, site or route information, and any equipment. If giving access takes longer than the job lasts, substitution is not practical; see the next section.

4. Pay. Decide and write down who pays the substitute. Where the person who sent them pays, you keep paying the person you engaged. HMRC's personal service guidance looks at whether the substitute is answerable to and paid by the person who sent them, so think carefully before paying a substitute directly. If you do pay them directly on a self-billed invoice, VAT Notice 700/62 says you must not self-bill any supplier without their written self-billing agreement. See self-billing software for how the pay side fits together.

5. Record. Log who substituted for whom, on which job, which checks were done, by whom and when, and whether the substitute was accepted. This sits in the audit file described in our record-keeping guide.

Sign-off for the record of the substitution: the person who checked the substitute's documents records their name, the date, the checks done and the outcome before the job starts.

# Make checks fast enough to be practical

HMRC's ESM11045 gives the example of someone hired for 2 weeks where it takes 2 weeks to add another person to the systems: substitution is then not plausible, and the hirer is treated as able to reject the substitute. It lists timescales, the nature of the work and security restrictions as factors that can make substitution unrealistic.

In practice:

• Publish the list of documents a substitute needs, so people can collect them before they are needed.
• Keep a short, written checklist so any manager can process a substitute the same way.
• Keep access steps short: a login, a site briefing, the equipment.

# Warning signs that a substitution right is only on paper

These are operational signals, not legal tests:

• nobody has ever used a substitute, and nobody knows how they would
• there is no written process, training or guidance on sending a substitute
• managers would turn a substitute away, or take the job back, without asking who it is
• logins, credentials or equipment cannot be passed to anyone else
• people are not told the right exists

HMRC notes that a right not being used is not necessarily relevant on its own, but it may look critically at a right that has not been used over a long period. If any of these signs apply, review the arrangement, and check status again with CEST if the working arrangement has changed. Our guides on employment status and IR35 cover the wider picture.

# Relief pools: useful, but know the trade-off

A pool of relief workers you have engaged and checked yourself is a reliable way to cover gaps. Treat it as your own cover, under each person's own agreement, rather than as substitution. HMRC's ESM11045 says that where a worker can only provide a substitute from a pre-approved pool, the client has the right to reject a substitute. Plan relief cover on the rota in the same way as any other work; our rota planning guide covers offering and recording it.

# Data you collect about substitutes

A substitute's documents are personal data. Under Article 5 of the UK GDPR, collect only what the job needs and keep it no longer than necessary. Set a deletion date when you record the substitution. The exception is right to work check records, which the Home Office guide says to keep for the length of the work and for 2 years afterwards. Our offboarding checklist covers removing someone from substitute lists when an engagement ends.

# How software helps

Zerity is one operating system for compliance and operations across your self-employed workforce:

• Every licence and policy expiry date is tracked in one place. Zerity stores the record, the date it was checked and the expiry; checking remains your duty, using the DVLA service or a bureau your insurer accepts.
• The rota is published to the driver app, and days worked feed the self-bill.
• The self-billing agreement is stored, invoices are raised from the agreed rate and days worked, and the PDF is kept. The software does not make the arrangement compliant on its own.
• One account covers every site, with people tagged by depot and network.

Zerity does not decide anyone's employment status, and it cannot make a substitution clause genuine. See compliance software for self-employed workforces, onboarding, scheduling and, for courier operations, subcontractor driver management. Pricing is from £6 per active driver.

Book a demo to walk through a substitution on your own data.

# Common questions

# Can we refuse a substitute?

HMRC's CEST guidance says that where a hirer can only reject a substitute because they are not qualified to do the work, that falls in the "No" category for the right-to-reject question, provided substitution is practical and plausible. An explicit right to reject, or a pre-approved pool, counts as a right to reject. Record the reason for any refusal. Separately, from 1 October 2026 a substitute should not start work until you have checked their right to work yourself, because the extended liability rules can treat you as their employer for right to work purposes.

# Who pays the substitute?

Your agreement should say. Often the person who sent the substitute pays them, and you keep paying the person you engaged. If you pay the substitute directly on a self-billed invoice, VAT Notice 700/62 says you need their written self-billing agreement first.

# Does a substitution clause fail if nobody has ever used it?

Not automatically. HMRC's manual says it is the right that matters, not whether it is used, but it may look critically at a right that has not been used over a long period. In BCA Logistics v Parker, the tribunal weighed the fact that no driver had used a substitute in over 25 years alongside other evidence.

# What records should we keep about a substitution?

Who substituted for whom, the job, which checks were done, who did them and when, whether the substitute was accepted, and who paid them. Keep only the personal data the job needs, and set a deletion date.

# Does running a substitution process make our workforce self-employed?

No. A process helps your operation handle substitutes, but employment status depends on the facts of the whole working relationship. Use GOV.UK's employment status guidance and HMRC's CEST tool, and remember that courts and tribunals can make final decisions.

# Sources

• Employment status, GOV.UK.
• HMRC, Check employment status for tax (CEST), GOV.UK.
• HMRC Employment Status Manual: ESM0530 personal service, ESM0535 is the right of substitution genuine, ESM8565 ineffective or sham substitution clauses, ESM11045 hirer's right to reject a substitute, GOV.UK.
• Employment Appeal Tribunal, BCA Logistics Ltd v Brian Parker and Others [2025] EAT 94, judgment of Mr Justice Cavanagh, 4 July 2025, GOV.UK.
• HMRC, Self-billing (VAT Notice 700/62), GOV.UK.
• View or share your driving licence information and Check someone's driving licence information, GOV.UK.
• UK GDPR, Article 5, legislation.gov.uk.