HMRC have offered much needed clarity around beauty industry and hairdressing employment law. In 2025, HRMC released guidance to that helps to determine whether individuals working in the hair and beauty industry should be classified as employed or self-employed.
This signified a much needed clarification for the hairdressing and beauty industry which has experienced longstanding confusion over employment status.
There is a growing trend of salon owners renting out chairs to other salon businesses. This business model, itself, can blur the lines between employment and self-employment for those working in salons, making it essential to understand the distinctions used by HMRC.
Incorrect hairdressing employment classification can have serious tax consequences, especially if the mistake comes to light following an HMRC compliance check.
Self-employed Hairdressing Employment Law: What Do You Need to Know?
The classification for some salons will be straightforward, such as where the owner doesn’t work themselves, but rents a number of chairs to people who each work on an independent basis. However, other salons may consist of a mix of working owners, employees and chair renters. The classification here will often be less clear-cut, especially as the salon may want to present a common brand identity. Some aspects of establishing self-employed status should be simple to implement, if the salon has not already done so. For example, chair renters should:
- Have their own business bank accounts and business insurance;
- Buy their own products and equipment;
- Have their own client list; and
- Keep business records.
- A common till or card machine is not an issue as long as income is separated for each chair renter.
Problem areas can occur around expected working hours and client distribution.
Ideally, chair renters should be able to decide the hours they work, and when to take time off. However, if a salon has walk-in customers, the owner will want to have a minimum number of personnel available. The decision may, therefore, be something of a compromise, but make sure the input from chair renters is documented.
Similarly, chair renters should be setting their own prices, but this will be problematic if everyone is offering the same services. Clearly, chair renters should set their own prices for any exclusive services they offer. Even if there is a common pricing, each chair renter should display their own price list. The recently published guidance (along with a link to the check employment status for tax (CEST) tool) can be found here.
Employed Hairdressing Employment Law: What do You Need to Know?
If you have employed status at a solon or beauty establishment, then there are number of employment laws that you have the right to. Employment law dictates that employed hairdressers have the right to:
- A salary meeting or exceeding National Minimum Wage from day one of your employment contract.
- Statutory annual leave entitlements.
- Access to a workplace pension scheme.
- Statutory sick pay when earning an average of at least £125 per week.
- Statutory Maternity and Paternity Pay following at least 26 weeks of continuous employment before the ‘qualifying week’ (the 15th week before the expected week of childbirth)
- Protection against unfair dismissal and the right to request flexible working (at the discretion of your employee).
It is important for all employees to understand their rights as an employee. Read further on the Gov.uk website.
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