Details of the new team emerged in a letter sent by Jane Ellison, financial secretary to the Treasury, in response to a request from Frank Field, chair of the work and pensions select committee, which has been looking at employment practices at delivery company Hermes and wanted to see HMRC take action.

Ellison said she was unable to discuss the details of any individual case, but noted that ‘the government takes false self employment very seriously’.

In her letter to Field, Ellison said that the government was ‘committed to taking strong action where companies, to reduce their costs, force their staff down routes which deny them the employment rights and benefits they are entitled to’.

She went on to state: ‘Employment status in the UK is determined by the reality of the working relationship and not simply by the terms of any contract,’ she said. ‘Individuals cannot be opted out of employment rights and protections simply by an engager calling them “self employed”.’

Ellison informed Field that HMRC is currently ‘transforming its compliance approach’ in this area and is to set up a new employment status and intermediaries team as a dedicated resource which will focus on status and intermediary issues to ensure they are ‘effectively tackled’.

Heather Self, tax expert at law firm Pinsent Masons, said that although the question of whether an individual is employed or self-employed is not new, ‘it is clear that HMRC will be challenging the position more frequently’.

‘This is relevant not only to low-paid individuals in the so-called “gig economy”, but also to those who work in other areas such as IT consultants or media professionals,’ she said.

Self cited the government’s announcement in March that it would be changing the rules for ‘off payroll’ workers in the public sector, and said ‘it is looking increasingly likely that this will be extended more widely.’

‘This could impose significant extra compliance burdens on those companies that regularly engage consultants, where the question of whether someone is truly self-employed is not always easy to answer,’ she said.

At the beginning of this month prime minister Theresa May asked Matthew Taylor, chief executive at the RSA, to lead an independent review into how employment practices need to change in order to keep pace with modern business models.

Taylor said the review, which is due to complete within six months, would address a number of themes including whether  the growth in non-standard forms of employment undermines the reach of policies like the national living wage, maternity and paternity rights, pensions auto-enrolment, sick pay, and holiday pay. It will also consider whether current definitions of employment status need to be updated to reflect new forms of working created by emerging business models, such as on-demand platforms.

Simon McVicker, director of policy and external affairs at IPSE, a body for professional contractors, said that there is a ‘justified worry’ about employers falsely labelling workers as self employed, and said the Taylor review ‘will provide more clarity on how employment relationships fit into new business models’.

‘However we are very surprised to learn that Jane Ellison has ordered HMRC to crackdown on “gig economy” companies before the Taylor review has even started. It is essential that there is agreement between business and government on what exactly self-employment is, until then, there will continue to be confusion,’ McVicker said.

Jane Ellison’s letter to Frank Field is here.