social care volunteers local support micro-enterprise providers local micro-enterprise committed connection volunteers

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1 micro-enterprise s cal ple commitment inclusion social care micro-enterprise orks providers local volunteers Map for Microenterprises in Social Care support volunteers committed connection Introduction 3 October 2011 local 1 Social care services involving car journeys 5 2 Social care services involving food 7 3 Criminal Records Bureau checks 9 4 The tax, employment and regulatory status of micro-enterprises 12 5 Registering with the Care Quality Commission 16 6 Going forward 18 Acknowledgements 19 Map for Microenterprises in Social Care 1

2 Contents page Introduction 3 1 Social care services involving car journeys 5 What is the problem? 5 What is being done? 5 What do I need to check? 6 2 Social care services involving food 7 What is the problem? 7 What is being done? 7 What do I need to check? 8 3 Criminal Records Bureau checks 9 What is the problem? 9 What is being done? 10 If you are self-employed 11 4 The tax, employment and regulatory status of micro-enterprises 12 What is the problem? 12 What is being done? 13 What do workers need to check? 14 What do Direct Payment holders need to check? 15 5 Registering with the Care Quality Commission 16 6 Going forward 18 Acknowledgements 19 Map for Microenterprises in Social Care 2

3 Introduction Social care is changing rapidly. People who use social care services now have more control than ever over the money which is spent meeting their needs. This can lead not only to new providers coming into the social care market place, but is also freeing up individuals and families to invest in very different and innovative services. Micro-enterprises in social care are very small enterprises which are set up to promote the support or inclusion of people who use care and support services. Usually they have five or fewer full time equivalent staff or volunteers. Map for Microenterprises in Social Care 3

4 There are tens of thousands of micro-enterprises in the UK. Micro-enterprises often wish to stay small scale and close to the people they serve, but with the rapid roll out of personal budgets and Direct Payments, there is the potential for many thousands more to contribute to growth in the sector and to positively influence the expectations and norms of larger-scale social care provision. A three year micro-enterprise development project in Oldham, employing a single worker, has resulted in the creation of 125 jobs and 40 volunteering opportunities. 25 of those positions were for older and disabled people, who design, lead and deliver some micro-enterprises and share ownership of others. This map will be useful for: People setting up, working in or supporting micro-enterprises Direct Payment holders and family carers Social care commissioners and practitioners National policy makers The Government s Growth Review identified four specific barriers to microenterprises in social care and committed government departments to work together, along with Shared Lives Plus (formerly NAAPS UK) and other sector organisations, to tackle them. Councils and other agencies should always aim to reduce red tape and reduce unnecessary burdens on business, avoiding duplication in regulation and taking a pragmatic approach to risk. This should include working together to help people to develop services which cross sector boundaries in order to better meet people s needs. The map will help you to understand what you need to do to understand regulations and requirements in five key areas: Whether you need to apply for a Private Hire Vehicle license, in order to provide a transport service for people who use your services Whether you need to register as a food business if you are cooking or providing food services to people who use your services Whether CRB checks and other checks are available for you Whether you might be considered employed or self-employed by tax inspectors and other bodies Whether you and your service need to register with the Care Quality Commission Map for Microenterprises in Social Care 4

5 1 Social care services involving car journeys What is the problem? We are aware that in some cases, micro-enterprises have been required by local councils to register as a taxi service in order to provide the simple service of taking an individual they are caring for to visit a friend or social event. The time and costs of registering can prevent them from providing a legitimate service. Case Study Companions is a micro-domiciliary care service established to provide consistent and flexible care for a small group of older people, who pay for the service from personal budgets or their own money. The providers consulted with potential customers before setting up the service. Older people said they couldn t use public transport and were essentially confined to their homes, isolated and lonely. Top of their wish list was help to get out into the community and to meet friends. Companions designed a service which included using their own cars to take people out but were told that they would have to be licensed as private hire vehicles. The costs and complexity of obtaining a licence were insurmountable, so they have, until now, not been able to provide the service most desired by their customers. What is being done? The Department for Transport has made amendments to existing guidance for local licensing authorities to clarify this. The key changes include the clarification that most car journeys undertaken in the context of care and support services do not fall within the Private Hire Vehicle licensing regime, particularly where the carrying of passengers is an ancillary part of the service and the driver is likely to have been vetted for wider work, may have specific social care qualifications or training, and will have wider duties beyond driving, which is often a small part of someone s role. Map for Microenterprises in Social Care 5

6 The Department for Transport has made it clear that they consider that people mainly providing care and support services should not be licensed because: carrying passengers is an ancillary part of the service; the driver is likely to have been vetted for wider work; the driver will have wider duties beyond those associated with driving; the driver is likely to have specific qualifications or training which go beyond driving and general customer care; and Parliament would not have had this sort of service in mind when passing the legislation. In the longer term, the Law Commission is undertaking a comprehensive review of taxi and PHV licensing legislation with a view to producing a report and a draft Bill in This will examine the legal framework relating to taxis and PHVs with a view to making it simpler and more modern. They plan to publish proposals for reform in April This will be followed by a three month consultation period where they invite the public to respond to our proposals. We will update you on progress on this nearer the time and you may wish to comment when the consultation is published. What do I need to check? You need to understand whether the service you are providing is an incidental part of a wider social care service, or mainly a transport service. Where transport is part of a wider service, you are likely to answer No to most of the tests set out in the new guidance. Services which are focused mainly or entirely on transport are, however, likely to need licensing, unless provided by volunteers who receive no recompense except for out of pocket expenses. See the full list of tests at gov.uk/publications/phv-licensing-guidance-note/phv-licensing-guidance.pdf Your local authority, that is the district/borough council or unitary authority, will have a Taxi Licensing Officer who will be able to advise you on any particular case. In London, Transport for London will be able to provide advice. You can find contact details for your local authority at: uk/en/dl1/directories/localcouncils/atozoflocalcouncils/dg_a-z_lg We are not currently aware of issues remaining to be addressed around PHV regulations, but please feed back any which arise, using the contact details provided at the end of this document. Map for Microenterprises in Social Care 6

7 2 Social care services involving food What is the problem? Many social care services involve support workers assisting people to purchase, store or prepare food, often in the person s own home. Some micro-enterprises make use of an ordinary domestic kitchen, such as meals without wheels services, in which elderly neighbours are supplied with regular hot meals. There is currently considerable confusion as to when social care businesses have to register as a food business and the resulting regulation that they are then subject to. A very small domiciliary care business involves helping people to shop for food and prepare meals in their own home. Usually, the service user does this with some prompting from the worker, but some days they need more physical assistance. The business has received conflicting advice as to whether it should register as a food business. What is being done? The Food Standards Agency (FSA) has committed to look at the process by which food businesses register their activities with the local authority and the advice given on food law requirements. The Growth Review also committed the FSA to review advice to local authorities about official controls on micro-enterprises. The FSA advises that local food authorities are responsible and best placed to determine whether activities being undertaken constitute those of a food business. The FSA also advise that proportionality should be exercised in terms of carrying out inspections and having regard to the domestic environments where activities may be carried out. The FSA recognises the difficulties faced by micro-enterprises, some of which are entirely voluntary and have very limited budgets. However, it must also be recognised that those receiving domiciliary care are often those most vulnerable of groups in terms of the risk from failures in food safety. Map for Microenterprises in Social Care 7

8 The FSA will shortly be seeking stakeholder views in relation to the registration of childminders and community halls. If there is strong evidence to support changes in relation to these, the FSA will consider the impact in other areas. What do I need to check? Some micro-enterprises are undoubtedly food businesses, because food preparation is their main activity, or because they involve delivering food or meals to people s homes. It is appropriate for these businesses to be registered and inspected and they must implement food safety management procedures based on the principles of Hazard Analysis and Critical Control Point (HACCP). Businesses which need to register as food businesses should register the establishment where their business is based, not the home(s) of service users, where food-related activity may take place. Where a food business is carrying out food activities at domestic premises, such as preparing food for the resident(s) to consume, food hygiene inspectors have right of entry into domestic premises, provided they have given 24 hours notice to the occupier. However, inspections should be proportionate and focus only on the relevant food activities and the areas where those activities happen. You can find contact details of your local authority food hygiene department at As this area of regulation is still in the process of being clarified, we would welcome information from micro-enterprises and other social care services about the impact of current regulatory practices. Regulated Shared Lives (formerly, Adult Placement ) living arrangements are exempt from the requirements of the particular regulations 1 and do not need to register as food businesses. 1 Regulation (EC) 852/2004 Map for Microenterprises in Social Care 8

9 3 Criminal Records Bureau checks What is the problem? The Criminal Records Bureau (CRB) currently provides two types of certificate, the standard and enhanced certificate. Both checks include all spent and unspent convictions, cautions, reprimands and warnings recorded centrally. The enhanced check may also include other information judged relevant to the position applied for and may include barred list information. Organisations providing regulated personal care to adults need to ensure that their staff members have received an enhanced CRB certificate. If you are employed you will be able to make an application through your employer. There is no requirement for those engaged by individual Direct Payment holders to obtain a CRB certificate. However, many Personal Assistants (PAs) and those for whom they are working may wish to request an enhanced CRB check and are able to do so. But if you are self-employed, you cannot apply for a CRB check in your own right, as you must have a registered person countersign your application. Furthermore, current requirements mean that if you are able to get a certificate, then when moving local authority areas you may have to re-apply at added cost and time for a new CRB certificate. You are also currently unable as an employed person to see your CRB certificate before it is issued to an employer to ensure that you have no concerns with the content. Map for Microenterprises in Social Care 9

10 What is being done? We are pleased to say that the Government has recognised and is addressing the issues around portability (the ability to transfer your existing CRB certificate to other areas) and around ownership and access to the check. The government intends, following recommendations in a recent independent review, 2 to allow people to carry over existing certificates to other employers by enabling them to check the status of a previous certificate and to provide for any CRB certificate you have to be sent straight to you in the first instance to check. The coalition government has reviewed the proposals to change the safeguarding system which were put forward by the previous government. There are a number of major changes planned for 2012, including a large reduction in the number of regulated activities requiring full Vetting and Barring checks. The employers of individuals not working in regulated activity but nevertheless working regularly, paid or unpaid, with vulnerable people, will continue to have the option to obtain criminal records information, which will become portable between jobs. Until the changes come into force, the safeguarding regulations introduced in October 2009 continue to apply. 2 Recommendations 2, 3 and 4 of A Common Sense Approach: A review of the criminal records regime in England and Wales by Sunita Mason, Independent Advisor for Criminality Information Management (available at gov.uk/publications/crime/criminal-records-reviewphase1/criminal-records-review?view=binary) These recommendations have been taken forward in Chapter 2 of Part 5 of the Protection of Freedoms Bill which was introduced before Parliament on 11 February Map for Microenterprises in Social Care 10

11 If you are self-employed The government recognises that existing arrangements do not always give self-employed people the same access to certificates as those who are employed and it is continuing to consider this issue. 3 Many micro-enterprises and sole traders would like to access enhanced CRB checks, and under current legislation they can do this through an umbrella body countersigning the application. 4 A number of umbrella bodies exist that can help people get access to CRB certificates. For example: East Sussex Council s Human Resources Department acts as the umbrella organisation for CRB checks for any individuals and organisations which apply to join its Support with Confidence scheme. Members of the scheme pay a modest sliding scale of fees and receive the CRB check as part of this fee. Membership is free for Personal Assistants (PAs). Members are interviewed, can access training and provide references. There is a code of conduct including a complaints system. 5 However, it should be emphasised that CRB registered and umbrella bodies can only facilitate criminal record checks at standard and enhanced level if they are the employer or are otherwise considering the individual s suitability for an eligible post. If you are self-employed and unable to get an enhanced CRB certificate, you can obtain a basic certificate from Disclosure Scotland. This service is available to people in England, Wales and Scotland and the certificate provides details of unspent convictions only. A basic certificate currently costs 25. Disclosure Scotland can be contacted at A CRB check is only one part of an effective approach to safeguarding and managing risk. Effective approaches to safeguarding also include interviewing, taking up written and verbal references, monitoring, effective complaints systems and access to independent advocacy. 3 As part of the Employment Law Review, the government is looking at all aspects of employment-related legislation and requirements on employers with the aim of reducing burdens on business and supporting economic growth. 4 Section 120 of the Police Act 1997 and the Police Act 1997 (Criminal Records) (Registration) Regulations 2006 (SI 2006/750 as amended). 5 approvedproviders/introduction.htm Map for Microenterprises in Social Care 11

12 4 The tax, employment and regulatory status of micro-enterprises What is the problem? The move towards personal budgets and Direct Payments and the ongoing increase in sole traders and micro-enterprises providing care services to individuals has led to confusion over whether people are employed or self-employed. It is extremely important that people are clear what their employment status is, both for legal and tax reasons. Their status has implications for many areas, including who is responsible for various statutory entitlements including sick pay, holiday pay and maternity pay. Furthermore, if you work for several people, it is possible to be self-employed in one situation and employed in another, where the working relationship is slightly different. This means you will have different responsibilities and entitlements in different circumstances. Some disabled people and Personal Assistants (PAs) have been under the impression that a PA can be treated as self-employed, even where the facts do not support that position. As a result, people have found themselves liable for unpaid National Insurance contributions and Income Tax, as well as holiday and sick pay. Others have found that the insurance they thought covered the arrangement was invalid. There can be differences in how an individual s employment status is regarded by HMRC and by the civil courts when, say, there has been an accident at work. For instance, where a worker is self-employed and provides support under a contract for service, but their work is nevertheless directed by someone else, the person directing the work may need to have Employers Liability insurance, rather than being covered by the sole-trader s public liability insurance. Map for Microenterprises in Social Care 12

13 What is being done? The Government is committed to providing as much information as possible to help people establish their employment status for tax purposes. This includes the following guidance: There are a number of indicators of being an employee. These include the following and answering yes to a number of them will indicate that you may be employed for tax purposes: you personally have to do the work (you can t send a substitute) you work for one person at a time who is in charge of what is done and takes on the risks of the business (for instance, through investing in training you) you can be told how, when and where to do the work you have to work a set number of hours, rather than setting a price for completing a task you are paid a regular amount according to the hours you work, and get paid overtime casual and part-time workers can still be employees You may be self-employed if you: can decide how, when and where to do the work for instance, someone running an activity session may decide what kinds of activities to offer, and where and when each week can hire people to do the work for you or to help you as a volunteer agree to do a job at a fixed price regardless of the time it will take can make a loss as well as a profit These are not exhaustive lists of the features of employment and selfemployment. If your working situation appears to have features of both employment and self-employment, you could still be self-employed if: you risk your own money or assets (for instance by using your home as your workplace, or your car to deliver a transport business, or if you have had to pay for a qualification or registration without which you wouldn t be allowed to do the work) you provide the main items of equipment needed to do the job you regularly work for a number of people and require a business set up in order to do so you have to correct unsatisfactory work in your own time and at your own expense Map for Microenterprises in Social Care 13

14 HMRC have asked the Low Incomes Tax Reform Group (LITRG) to prepare over the next year a definitive guide for individuals and organisations involved in Direct Payments. At the same time HMRC are aware of the issue of consistency and are providing information to local tax officers to try and get a more consistent approach on the ground. The Government is keen to hear from Direct Payment recipients and micro-enterprises that have experience of these issues. What do workers need to check? For advice on whether your tax inspectors are likely to view you as selfemployed or employed, see the HMRC website employees/start-leave/status.htm and take expert advice from a registered financial adviser or tax adviser. Your employment status will also determine your rights at work. Just because you have a contract that describes you as an employee or as self-employed does not mean that it is necessarily the case. If you are unsure about your employment status, you can find out more information and example situations on the Direct Gov website at Understandingyourworkstatus/DG_ People who provide support sometimes band together to coordinate their work so that, for instance, they can provide holiday or sickness cover for each other. Support workers only have a need to do this where they are self-employed. If you are an employee of a Direct Payment holder, it is your employer s responsibility to cover employees absences. Where sole traders do group together, even if those arrangements are entirely verbal and informal it is possible for them to be considered to have formed a partnership. People often use the term partnership informally, but a partnership also has a particular meaning in corporate law. Groups regarded in law as partnerships often have common aims and practices (written down or agreed verbally) and may use the same forms and procedures. If your group would be regarded as a partnership, each partner may still be regarded as self-employed for tax reasons, but partners may share certain liabilities and responsibility for decisions taken by other partners. See also registration with CQC, below. Map for Microenterprises in Social Care 14

15 What do Direct Payment holders need to check? Many Direct Payment holders are daunted by the prospect of becoming an employer. Instead of taking their personal budget as a Direct Payment, an individual could choose to ask their council adult services department, a brokerage organisation, or a service provider to manage their personal budget allocation for them. People doing this can retain a high degree of choice about the services they receive, without taking on the legal responsibility for the money and workers involved. If a worker claims to be self-employed, this should be reflected in a support agreement or contract and they should be able to produce evidence of: Public liability insurance Tax registration Registration with CQC in some cases (see below) None of these pieces of evidence is, on its own, a guarantee that the worker would be considered by HMRC or an employment tribunal to be selfemployed, so Direct Payment holders are always advised to call HMRC with a description of their situation. It is always the employer s responsibility to make Pay as Your Earn (PAYE) tax deductions, so it is important for care purchasers to establish whether or not they are an employer. Map for Microenterprises in Social Care 15

16 5 Registering with the Care Quality Commission All providers of regulated activities have to register with the Care Quality Commission (CQC) and meet the registration requirements 6. CQC inspect registered services to ensure they are meeting minimum standards of safety and quality. CQC is responsible for interpreting and implementing the regulations. If you are unsure about whether or not you need to register, contact CQC for advice. Workers whose support work is directed or managed by an individual Direct Payment holder do not have to register that activity with CQC, even if it includes personal care 7. This is because there is an exemption from regulation for the services of a carer employed by an individual, without the involvement of an undertaking acting as an employment agency or employment business. Workers employed by an individual include workers employed under a contract of service or a contract for services, so the worker could be regarded as self-employed by HMRC for tax purposes, but nevertheless be seen by CQC as being employed by an individual, where the care they provide is directly arranged by the Direct Payment holder without an agency being involved. Local Authorities may only purchase regulated care services (such as personal care in the home) from a registered provider. Personal care provided to the individual outside of their home or their care home (e.g. when they are out in the community or using a day centre) is not subject to CQC registration, so can lawfully be purchased by a council from an unregistered provider. Independent User Trusts (IUTs), are trusts set up to make arrangements for nursing care or personal care on behalf of someone who lacks capacity to do it for themselves. It was intended that care arranged by IUTs would also be exempt from the need to register with CQC. At present, it is recognised that care arranged by IUTs is not, in fact, exempt and the government is currently consulting on whether to legislate in 2012 to exempt care arranged by IUTs, parents and unpaid family carers. 6 Regulated activities are set out in Schedule 2 of regulations made under the Health and Social Care Act 2008 and in CQC s The Scope of Regulation. 7 Personal care is defined in CQC s The Scope of Regulation. Map for Microenterprises in Social Care 16

17 A group or partnership (see note on partnerships, above) of self-employed workers is not required to be registered, if each worker only provides care which is arranged and managed by a Direct Payment holder. In other words, where arrangements about care are made directly between each individual worker and each service user, not via a coordinator. If, however, the group does carry out a regulated activity, it must be registered with CQC as a provider with a registered manager. A person or organisation who simply introduces potential workers to a care purchaser is not expected to register, providing they have no ongoing role in supervising them or organising care. 8 Micro-enterprises and individuals who wish to demonstrate the quality and safety of their service, whether or not they can register with CQC, could take part in a quality assurance scheme: Community Catalysts has developed and tested a DH funded Quality Mark to help registered and unregistered micro-enterprises to demonstrate their quality to budget holders and commissioners. They can demonstrate their current achievement of quality thresholds and then continuous improvement, with a citizen panel providing external scrutiny during the assessment stages. Oldham council has adopted the Mark for micro-enterprises like Choice Support Transport (CST) which offers activities for people with a learning disability but fell outside the scope of regulation. CST describe themselves as little fish slipping through the net of quality assurance. Taking part resulted in them completing tasks they had been putting off. Personal Health Budgets are being piloted, in which people may take an allocation of NHS resources as a personal budget. Whilst many social care Direct Payment holders will fit the definition of employer, it is likely that Personal Health Budgets may more often be used to purchase support from self-employed professionals such as chiropractors and therapists. 8 Care Quality Commission: Guidance about compliance Essential standards of quality and safety March 2010, p245-6 Map for Microenterprises in Social Care 17

18 6 Going forward In clarifying Private Hire Vehicle regulations, the Department for Transport (DfT) sets the tone for the new approach to low-bureaucracy government. The DfT guidance recognises that it is not its role to interpret legislation, nor to seek to restrict councils use of discretion. But, grey areas having been identified which cause confusion, it is reasonable that a Department should offer a view and indicate the relevant considerations, to help local decision makers. The DfT s starting point for this is to go back to first principles : the intention of legislators to make transport safer. The DfT urges licensing authorities to think carefully about the burden which would be placed on people and organisations who are in the grey areas, before imposing licensing requirements upon them, weighing up this burden against the positive outcomes of licensing. We hope that more red tape areas are identified in coming years. This would be an indication of continuing creativity amongst providers and the willingness of the state to support that creativity. Micro-enterprises which identify potential problems with red tape and bureaucracy should get in touch with Shared Lives Plus via or Shared Lives Plus and government departments are committed to further work on the issues identified in this map, as well as others yet to be identified, so it is our intention that this guide will map territory that is constantly changing, and we will update this information accordingly. Map for Microenterprises in Social Care 18

19 Acknowledgements Many of the challenges and solutions identified in this map are the result of the work of Community Catalysts and its network of micro-enterprises. ADASS The Care Quality Commission FSA Shared Lives Plus Think Local, Act Personal Officials in BIS, DH and other government departments. In particular we would like to thank Rachel Armstrong, John Hampson and John Crook. Map for Microenterprises in Social Care 19

20 micro-enterprise commitment volunteers s cal ple inclusion social care micro-enterprise orks providers local support volunteers committed connection local t: Shared Lives Plus Ltd 2011 Registered charity: Registered company: Map for Microenterprises in Social Care 20