HMRC scores own goal in key employment status case

UPDATED: The First Tier Tribunal have re-affirmed their decision that referees contracted by PGMOL are self-employed contractors, rather than employees.  This follows the case being referred back to the Tribunal by the Supreme Court. 

UPDATED ON 17 SEPTEMBER 2021, 2022, and 8 MAY 2026

Following a number of cases and appeals, and many years of arguments, the case of HMRC v Professional Game Match Officials Ltd (“PGMOL”) appears to have been finally settled, following a second decision by the First Tier Tribunal (“FTT”). 

Background

In HMRC v PGMOL the issue is whether certain referees engaged to officiate at 5 football matches by PGMOL were at the relevant time employees of PGMOL (being engaged under contracts of service) or were self-employed (being engaged under contracts for services) for the purposes of income tax and national insurance contributions (NICs).

PGMOL is effectively owned and controlled by the three main English football bodies (the FA, Premier League and the Football League). It provides match officials for competitive games. 

PGMOL have a number of referees who are employed on a full-time basis (who generally officiate at Premier League and some international matches). Other referees, however, provide their service in their spare time (frequently around full-time employment) and these are the ones who the case centred around. 

Although the costs of paying the referees (fees and travel expenses) are borne by the member organisations, it is PGMOL who actually made the payments to the referees. 

The case related to determinations issued by HMRC relating for 2014/15 and 2015/16 on the basis that the PGMOL was the employer of certain football referees during three football seasons.  

To counteract HMRC’s decision that these referees were employees, PGMOL argued initially that the referees were not under any contract with them and so there could not be an employment contract in place. If there was a contract in place, the nature of the contract would not be sufficient to create an employment relationship. 

There was a significant amount of tax and national insurance at stake. 

Timeline and summary of the case 

The First-tier Tribunal (FTT) originally decided back in 2018 held that the referees were not employees of PGMOL, a decision that was later endorsed by the Upper Tier Tribunal (UTT) in 2020.   

HMRC appealed against the decision and the Court of Appeal in 2021 held that the FTT and UTT both erred in law in their approaches to the question of mutuality of obligation and upholding the UTT's decision that the FTT had also erred in its approach to the issue of control.  They remitted the case to the FTT in what was seen as a victory for HMRC.

PGMOL appealed this decision and in 2024, the case was heard by the Supreme Court. The Supreme Court dismissed PGMOL’s appeal and agreed with the Court of Appeal that the case should be referred back to the FTT. 

Now, the FTT have reheard the case and on 1 May 2026, have issued a new judgment.   The FTT have re-affirmed their original decision that the referees are contracted on a self-employed basis and should not be subject to tax and national insurance as employees. 

The new decision of the First Tier Tribunal

The full judgment can be found here - Professional Game Match Officials Ltd v The Commissioners for HMRC - Find Case Law - The National Archives

In the original judgment of the FTT, the case centred around the three qualities that must be present in a contractual relationship for it to be one of employment:

1. There must be mutuality of obligations (so the referee agrees to provide his own personal service in return for a wage or other remuneration).

2. There must be a sufficient degree of control

3. The other provisions of the contract are consistent with its being a contract of service (this is a negative test looking to establish if the referees were in business on their own account)

In referring the case back to the FTT, the Supreme Court directed them to look at the case a second time but on a revised basis to consider the question of “whether the individual match engagements were contracts of employment in circumstances where mutuality and control have already been found to be present”. 

This means that the key point to be established was, where points 1 and 2 above had already been established, whether the other provisions of the contract were consistent with a contract of service. 

The decision of the FTT considered the following factors in considering the position as a whole:

Looking at the overall picture, the FTT concluded that the nature of the mutuality of obligation, and the nature and level of control (while accepting that both factors existed as directed by the Supreme Court) was insufficient to indicate that the match engagements were contracts of employment. 

When considered alongside the other factors, the FTT concluded that the referees were engaged on a self-employed basis. 

Per the judgment, “the relationship lacks the defining hallmarks of employment: ongoing mutual commitment, subordination in performance of the central task, organisational integration into the engager’s undertaking, and economic dependency. What emerges instead is the picture of skilled professionals participating voluntarily in a regulated framework, undertaking discrete engagements for remuneration while retaining substantial autonomy and independence”

Our opinion

The new FTT judgment raises issues which need to be kept in mind when assessing the employment status of contractors.  The key points to consider are as follows:

1. The presence of mutuality of obligation and control by the engager do not necessarily result in a contract of employment. 

2. It is important to look at the nature of the mutuality of obligation and control, as well as other factors in their legal and factual context, to conclude on the position. 

3. While there may be a number of factors present which indicate an employer/employee relationship, this again is not conclusive. The position must be considered as a whole, and the factual position may require different weight to be given to different factors when coming to an overall conclusion of employment status. 

The judgment suggests that HMRC may have taken too strict a view on what constitutes an employment contract previously, placing too great an emphasis on the presence of mutuality of obligation and control, and failing to properly consider the qualitative nature of these factors. 

Previous judgments in this case

1. Initial First Tier Tribunal Hearing

The full judgment can be found here.

The case centred around the three qualities that must be present in a contractual relationship for it to be one of employment:

1. There must be mutuality of obligations (so the referee agrees to provide his own personal service in return for a wage or other remuneration).

2. There must be a sufficient degree of control

3. The other provisions of the contract are consistent with its being a contract of service (this is a negative test looking to establish if the referees were in business on their own account)

The Tribunal concluded that there was a contractual relationship between PGMOL and, in reaching this decision, found that there were two levels to this: 

• an overarching framework which covered the football season in its entirety and set out the relevant terms of engagement; and 

• agreements for each match the referees were engaged for.

The Tribunal agreed that there was no guarantee or promise of work in the overarching framework and therefore this did not constitute an employment relationship. 

With respect to the individual agreements, the Tribunal concluded that there was no right to appoint a substitute and therefore personal service was required. Normally this would be sufficient for mutuality of obligations to be satisfied; however, in this case, even after acceptance of the contract, the referees had an unfettered right to cancel each arrangement. Therefore, there was no obligation on either side to continue with the engagement and the first test set out above was not met. 

The Tribunal also noted that the referees claimed there was no control over where they were sent. The Tribunal did consider that this did not reflect the legal position as the referees could state a geographical preference and they could also refuse any engagement offered. 

The Tribunal also considered that PGMOL did not exercise sufficient control over the referees as much of what they provided was guidance rather than control. The control that existed was more to ensure compliance with the rules of the game rather than being specific requests from PGMOL.

Another key point was that, whilst the games were in operation, it was the referees who were in charge. 

Finally, the Tribunal did consider that the other factors in the relationship were more supportive of there being an employment relationship. However, due to the lack of mutuality of obligations, HMRC lost its case.

2. Upper Tribunal (UT) Appeal 

The Appeal was heard at the end of January 2020. The full judgment can be found here.

HMRC appealed against the FTT decision that there was insufficiency of mutuality of obligation in the overarching framework and that there was insufficiency of mutuality of obligation and of control in the individual agreements. 

UT agreed with the FTT’s conclusion on mutuality of obligations and considered that “HMRC’s real complaint is that it disagrees with the conclusion the FTT reached”.

The UT did consider the question of control for completeness and reached the conclusion that the FTT did err in its judgement on this side. However, as this would make no difference in this case, no further analysis was undertaken.

The UT did confirm that it remains essential that “some sufficient framework of control exists” and they also considered PGMOL’s ability to “step in” and give instructions to the referees as well as their ability to impose sanctions whilst the contract was in force. They did also consider the length of the contract as opposed to single engagements. 

3. Court of Appeal decision

The Appeal was heard at the end of January 2020. The full judgment dated 17 September 2021 can be found here. 

The Court of Appeal concluded that the FTT and the UTT erred in its approach to the question of mutuality of obligation and that the FTT erred in its approach in respect of control. 

The judgment states that there remains a mutuality of obligation even where either side can terminate the contract without sanction.  They also stated that the PGMOL’s assessment system constituted control over the performance of the referees. 

They determined that the decision should be referred back to the FTT. 

4. Supreme Court decision

The full judgment dated 16 September 2024 can be found here. 

The Supreme Court dismissed PGMOL’s appeal and remitted the case to the FTT.  They stated that while it should be established that both mutuality of obligation and control were present, it did not necessarily mean that there was an employment contract in place. 

They said that the FTT should review the facts again to determine whether, accepting that these factors were present, whether the nature of the mutual obligations and control, and to assess whether an employment contract exists in respect of each match contract, evaluating the factual position as a whole.

Contact us today

If you wish to discuss the implications of this case and how it may relate to your engagement practices, please contact a member of our Employer Solutions team.