On 1 May 2026, the First Tier (Tax) Tribunal (“FTT”) found that, despite HMRC’s assertions to the contrary, certain referees engaged by Professional Game Match Officials Ltd (“PGMOL”) were self-employed, rather than employed, for tax purposes (see the case here). This decision is the latest (though possibly not the last) installment in a long running dispute between HMRC and PGMOL, but it also has much broader implications for any organisation concerned about the tax status of its contractors.

A quick health warning before we look at the decision and what we can learn from it, the concept of “employment status” has overlapping but different meanings in tax law and employment law. For tax law purposes, there are two distinct categories of employment status: employed and self-employed. In employment law, similar but slightly different considerations apply, and there are three categories of employment status – employee, worker and self-employed. This decision is a tax case, and should be viewed as such; though it does also raise some interesting points relevant to the employment law context.

Background

The background to this case is long and fairly convoluted. In brief, PGMOL is the body that engages and pays referees for officiating professional football matches. Certain elite referees, including those who routinely referee Premier League matches, are directly employed by PGMOL. Below them, there is a separate group of referees who more commonly referee games in Leagues 1 and 2 (amongst other competitions), typically doing so in their spare time alongside other, primary employment.

The dispute centred on whether this latter group of referees were self-employed (as PGMOL argued) or employees (as HMRC argued) for the 2014/15 and 2015/16 tax years. If HMRC was correct, PGMOL would have tax and national insurance liabilities of £583,874.07.

The legal test for employment status in a tax context is based on the test set down in the case of Ready Mixed Concrete v Minister of Pensions [1968] 2 QB 497 (as refined through subsequent case law). It necessitates three key considerations:

  1. Is there personal service from the individual / mutuality of obligation between the parties? I.e., does the individual agree personally to provide their own work and skill in exchange for remuneration, and the organisation agree to provide them with regular work? This can be contrasted with the individual agreeing to ensure that the work will be done (but not by whom).
  2. Does the organisation have a sufficient level of control? I.e., does the individual agree that, whilst performing the services, they will be subject to a sufficient degree of control from the other party in respect of how they carry out the role, such that that party is, in effect, their employer?
  3. Is the agreement between the parties consistent with a contract of employment? I.e., are the other provisions of the agreement consistent with it being a contract of employment? This is a flexible, multi-factorial evaluation, not a mechanistic limb by limb analysis.

In 2018, the original FTT found that criteria 1 and 2 above were not met in respect of the relevant referees: there was no personal service from the referees / mutuality of obligation between the parties, and PGMOL did not have a sufficient level of control over the referees in respect of how they carried out their roles.

This decision was appealed through the Upper Tribunal and Court of Appeal and finally determined by the Supreme Court (“UKSC”) in 2024. The UKSC unanimously found that there was an “irreducible minimum” of mutuality of obligation between the parties, and a framework of control, sufficient to meet criteria 1 and 2 of the Ready Mixed Concrete test outlined above, in respect of each separate match engagement. The UKSC did not, however, determine whether criterion 3 had been met; it remitted the case back to the FTT to determine whether the individual match engagements were properly characterised as contracts of employment or (self-employed) contracts for services.

The FTT’s decision in this case

In its analysis of criterion 3, the FTT found that these referees’ contracts were not contracts of employment, but rather contracts for services; meaning that the referees should be classed as self-employed (rather than employees) for tax purposes.

At first blush, this might seem like a surprising conclusion, given the UKSC decision on criteria 1 and 2. It is, therefore, worth considering carefully the FTT’s reasoning.

The FTT emphasised that this was not a checklist exercise, but a holistic assessment of all the circumstances. However, some of the key factors that pointed away from employment in respect of each engagement were:

  • Freedom to accept / decline engagements. Referees were free to accept or decline engagements at will – and in practice did so (including after appearing to commit to an engagement) – without any contractual or disciplinary consequences.
  • No ongoing commitment. Engagements were episodic and the absence of any ongoing commitment or obligation between engagements was central. Referees were not entitled to any retainer or inter-engagement payments.
  • Motivation & economic context. There were factual findings that refereeing “did not pay the bills” and was “pursued as a serious hobby alongside full-time employment”. Referees were motivated by passion rather than financial gain.
  • On-field autonomy. PGMOL could not direct or correct on-field refereeing decisions; referees had complete autonomy during engagements. This was incongruous with an employment relationship, in which employers typically retain control over how employees do their work.
  • Regulatory not managerial control. PGMOL did have some oversight of referees (e.g. behaviour and integrity requirements), but these arose primarily from extrinsic regulatory standards (e.g. FA standards), rather than as an employer exercising discretionary control over how work is performed.
  • Disciplinary authority. PGMOL did not discipline referees for poor refereeing decisions but only for integrity or compliance matters. This limited disciplinary scope pointed away from employment.
  • No integration. Although referees were operationally involved with PGMOL, they were not integrated into PGMOL’s organisation in the employment sense. They were integrated into the FA’s sector-wide regulatory system, not PGMOL.

Key takeaways

This decision is a timely reminder of the relationship between the three limbs of the test for employment in a tax context. Criteria 1 (mutuality of obligations) and 2 (control) are necessary pre-conditions for the potential existence of the employment contract. Criterion 3, however, is a holistic assessment in which the nature and context of the preceding criteria of mutuality and control, along with an array of other factors, must be considered in the round.

Although the facts of this case are specific, the principles applied by the FTT are directly relevant to any organisation engaging contractors, freelancers or casual workers. Some key practical takeaways from this case are set out below:

  • Criterion 3 is a holistic, real-world review. Criteria 1 and 2 are necessary preconditions for criterion 3, but they do not automatically determine its outcome. Criterion 3 is a multi-factorial analysis considering all the relevant circumstances. It is not to be applied mechanistically or in the abstract.
  • Avoid blanket rules. As is noted above, certain elite referees were employees, whereas those referees subject to this dispute were not. Organisations should not assume that two individuals contracted to do similar (or even identical) work will automatically have the same tax status. The context of that working relationship is equally important to criteria 3.
  • The written contract is not the final word. Organisations cannot simply rely on contractual wording. Tax status assessments must take account of the practical reality of a working relationship between the parties.
  • And neither is the HMRC tool. HMRC has developed an online tool to help organisations check the employment tax status of their contractors (Check Employment Status for Tax (CEST)). This provides a useful starting point, but can be overly simplistic. We would recommend carrying out further analysis and seeking legal advice, particularly in borderline cases.
  • Remain alert to changes in the working relationship. Even if an organisation correctly assesses an individual as self-employed, they may not stay that way. Organisations should stay sensitive to any material evolution of the way work is commissioned and delivered, whether or not this is recorded in a formal contractual variation. Re-assessing tax status is always safer than ignoring any changes.
  • Adopt a reasonable process. This is a tricky and fact-sensitive area. However, if your organisation makes a mistake in its classification, it is less likely that HMRC will take an aggressive stance if it can be shown that reasonable care was taken in making the assessment and a clear and appropriate process was followed.

If you would like to discuss anything outlined in this article, please get in touch and our team of experienced Employment lawyers would be happy to help.

The material in this article is provided for guidance and general information only and is not intended to constitute legal or other professional advice upon which you should rely. In particular, the information should not be used as a substitute for a full and proper consultation with a suitably qualified professional. Please do contact the Bates Wells team if you require further advice.