Billing hosts and hostesses via a trade license? Is that possible?
For many companies, it is still unclear how promotional staff, hosts & hostesses or external trade fair staff should be billed.
For this reason, we have prepared all the key legal aspects for you in this article.
Trade license or employment contract
The most important thing in advance: The billing of Trade fair- and event personnel via a trade license is (and was) prohibited by law in the context of so-called "bogus self-employment".
Self-employed within the meaning of the law is anyone who is "essentially free to organize their work and determine their working hours". This first and most elementary distinction between employee and self-employed person already makes it clear that promoters and hostesses cannot be self-employed, as their working hours, location and activities are prescribed within a narrow framework.
Employment in the context of "bogus self-employment" is assessed by customs as evasion of social security contributions and is punishable by draconian fines and even imprisonment.
This is not new. It's just that it's been very tightly controlled recently...
Consequently, only the employment of trade fair personnel as employees subject to social security contributions is legal!
Do I have to hire hostesses myself?
Since it is unrealistic and unrealistic for every advertising or trade fair entrepreneur to employ their own hostesses as employees, there are two ways of having "external employees" work for them.
The temporary employment contract (AÜV) (optimal) and the order (emergency solution)
Worth knowing about the perfect solution: Temporary employment
In the case of employee leasing, the employee of one company is leased to another company.
For this, the company that hires out the employer (the hirer) requires an official permit - which we naturally have. There are no special requirements for the company that hires out the employee (the hirer).
In order for the loan (hiring out) to be legal, the lender and hirer must conclude a written contract in advance.
Advantages for entrepreneurs
If you hire out employees as part of an AÜV, the right to issue instructions is transferred to you. This means that you can issue work instructions to the employee as you would to your own employees.
Otherwise, the employee working for you remains employed by the hirer. All reporting and (social security and tax) obligations therefore remain with the hirer.
In 2009, the legislator also addressed the problem of undeclared work and introduced a regulatory immediate registration requirement. This means that certain industries and trades are obliged to submit a social security registration before an employee starts work, but no later than the first day of employment.
This also included employers of hosteat and promoterinside
We are also happy to take on this task for you.
The legally compliant employment of temporary workers by reputable companies with a license to hire out their workers therefore offers numerous advantages:
- No risk of fines
- No obligation to report
- No social security contributions
- Short-term and needs-based personnel planning
- Not bound by the KSchG
- Calculable personnel costs
- Employment of personnel from outside the industry (promotersinside and hosteat)
- and much more.
Interesting facts about the emergency solution: Order
Particularly in large companies, the co-determination rights of the works council or any collective agreements can make the use of temporary workers difficult or impossible. In this case, it is by no means necessary to employ tradespeople and make yourself liable to prosecution. As an emergency solution, an order can be placed here.
In the case of an order, the end customer (client) who deploys the employee and the Agency (contractor), which hires the employee, a contract for work. This contract for work does not require any special form. In our case, it is the offer signed by you that we send you in response to your request. This sets out all the key points of the work. By signing it, you agree to the details and conditions of the contract. Anything that is not explicitly regulated is then primarily subject to the contractor's right to issue instructions.
The assigned employee has an exclusive employment relationship (service contract) with the contractor and works for you in the name and sphere of authority of the contractor.
This means that you have no right to issue technical instructions to the employee. All work instructions (no matter how small) must be commissioned from the agency and instructed to the employee by the agency.
This solution is as cumbersome as it sounds. The implementation of instructions is very slow due to the long communication channels. The long communication path can be shortened by having a project manager from the agency on site, who receives the client's wishes and passes them on to the agency on his own initiative. Personnel is implemented. However, this naturally results in additional costs for the intermediary project manager (so-called "bridgehead model"). To ensure clear demarcation, it is also advisable not to integrate the project manager into the workflow of the staff.
As the client, you are not authorized to issue technical instructions to this project manager either.
This is comparable to a craftsman building a house.
You can tell the roofer which tiles you want and how the roof should look. However, which employees he uses and how he carries out the work is not, within certain limits, subject to the homeowner's right to issue instructions.
In addition to the inconvenience, there is a great risk in this case (especially at trade fairs and public events with a high customs presence) that a request made by the client to the staff will be understood or interpreted as a work instruction.
This can have serious and expensive consequences.
Placing an order therefore has numerous disadvantages:
- No right to issue instructions
- High "susceptibility to errors"
- Impending fine as a result
- Slow response times during implementation
- Additional costs for bridgehead model
- No direct influence on employees on site
Popular misconceptions
Several clients:
Probably the most popular misconception is that ae Self-employedr (trader) as hostess or promoterin only has to have several clients in order not to be bogus self-employed.
In fact, the distinction between the self-employed/employee groups is based on 3 criteria, according to relevance:
The starting point is § 84 para. 1 sentence 2 HGB (no direct application, but general legislative assessment), according to which anyone who is essentially free to organize their work and determine their working hours is self-employed.This point alone applies to virtually non Hostess or promoterin to.
Integration into an external production area/work organization A self-employed person is generally not integrated into an external production area or external work organization. Ae Hostess or promoterin already.
Use of the entire workforce for externally planned/non-profit purposese Self-employedr always uses a part of his manpower solely for his own company. Ae Hostess or promoter* usually not.
Other criteria such as the treatment of comparable employees, the designation by the contracting parties, the continued payment of remuneration in the event of absence or even the payment of social security contributions are only used to assess the employment relationship if the first three criteria mentioned do not allow a reliable conclusion to be drawn.
The number of employers is completely irrelevant for the assessment. This makes sense because working for several employers in the context of employment subject to social security contributions or as a so-called mini-job is quite common, especially in the low-wage sector. This fact is therefore unsuitable as a distinguishing feature from the outset.
Short-term leasing:
It is often assumed that the short-term assignment of an employee is legal. However, the fact is that even the assignment of an employee for a so-called "logical second" requires official approval. An employee is deemed to have been assigned if he or she carries out a work instruction that he or she has received from a person who is assigned to the sphere of control of another company. If there is no approval or if no AÜV has been concluded, all of the above-mentioned legal consequences may apply.
Please contact us if you have any further questions or if you would like advice on a suitable contract model for you!
