PGMOL v HMRC 2024: What the Supreme Court Ruling Means

The Supreme Court's judgment in PGMOL v HMRC [2024] is the most significant employment status case in a generation. It directly shapes how IR35 assessments should be carried out in 2026 - and any assessment that does not engage with its reasoning is operating on outdated legal foundations.

Background: who is PGMOL?

Professional Game Match Officials Limited (PGMOL) is the body responsible for managing referees who officiate Premier League and English Football League matches. Match officials operated through personal service companies. HMRC argued that, for National Insurance contributions purposes, the working relationship between each official and PGMOL should be treated as employment.

The engagement structure was typical of many contractor arrangements: the officials had personal service companies, worked across multiple appointments in a season, had no guarantee of a specific number of games, and operated with considerable autonomy in officiating decisions. HMRC focused on the MOO argument - claiming that the framework agreement and repeat engagements created employment-like obligations.

The case ran from the First-tier Tribunal through the Upper Tribunal, Court of Appeal, and ultimately to the Supreme Court. Each level produced detailed analysis of the employment status tests, making the appellate history itself a useful guide to the current law.

The three-stage test confirmed

The Supreme Court confirmed that employment status analysis must proceed in three stages:

• Stage 1 - The hypothetical contract: Identify what contract would exist between the worker and the end client if the intermediary (PSC) were stripped away. What obligations would the parties have to each other?
• Stage 2 - Employment status: Does that hypothetical contract, on its terms, amount to a contract of service (employment)? Apply the classic tests: is there sufficient MOO? Is there sufficient control? Is personal service required?
• Stage 3 - Business on own account:Even if the Stage 2 tests are satisfied, is the overall picture consistent with employment - or does the worker's broader situation (multiple clients, financial risk, business identity) indicate that they are genuinely in business on their own account?

This three-stage framework is important because it prevents any single test from being applied mechanically. A contractor with a long-duration single-client engagement may satisfy MOO and control at Stage 2, but a strong BOOA picture at Stage 3 can still support an outside-IR35 conclusion.

The MOO clarification: irreducible minimum

The most immediately practical aspect of the PGMOL judgment is its treatment of mutuality of obligation. The Supreme Court drew a clear distinction between two types of MOO:

• Basic (irreducible minimum) MOO: The mutual obligations that are inherent in any contract - the obligation to perform the agreed services, and the obligation to pay for them. The Court confirmed that this basic MOO exists in almost every binding contract and is not, on its own, sufficient to establish employment. A one-off engagement where a builder quotes for and performs specific work has basic MOO - but nobody suggests the builder is an employee.
• Enhanced MOO: An ongoing obligation to offer and accept work beyond the current engagement - the kind of overarching commitment characteristic of employment. A contract that creates an expectation of continued engagement, an obligation to be available, or a commitment not to work for competitors exhibits enhanced MOO. This is what the courts look for when assessing whether MOO supports an employment finding.

BOOA as the decisive final test

The Supreme Court's confirmation that BOOA operates as a final holistic test - not just a tiebreaker - gives contractors a meaningful tool in cases where the primary tests are ambiguous. The Court reaffirmed the importance of the question posed in Market Investigations Ltd v Minister of Social Security [1969]: is the worker performing services as a person in business on their own account?

In the PGMOL case itself, the Court found that the officials had some degree of business identity, but that the overall weight of the employment indicators - the control PGMOL exercised over officiating, the integration into the match-day structure, and the relative weakness of any genuine business beyond refereeing - ultimately supported the employment finding.

The lesson for contractors is that BOOA cannot be bolted on as an afterthought - it needs to reflect genuine commercial reality. A contractor who actually provides services to multiple clients, carries insurance, uses their own tools, and has a distinct business identity is well-placed on BOOA. One who effectively works full-time for a single client with no other business activities faces a harder argument.

How PGMOL interacts with Atholl House

Atholl House v HMRC [2022] (Court of Appeal) is the other landmark case from this period. Where PGMOL addresses MOO and the overall framework, Atholl House focuses on substitution. The key holding was that a right to substitute that has never been exercised - or has only rarely been exercised - can still be given genuine legal weight if the right was part of the actual terms of the engagement and was commercially viable.

Together, these two cases establish the current framework:

• MOO must be assessed for enhanced obligations, not dismissed as universal (PGMOL)
• Substitution rights are real legal provisions even when unexercised, provided they reflect commercial reality (Atholl House)
• BOOA is a genuine holistic final test, not a formality (PGMOL)
• The correct methodology is the three-stage analysis - hypothetical contract, employment tests, BOOA (PGMOL)

Practical implications for IR35 assessments in 2026

Any IR35 assessment conducted in 2026 should incorporate the PGMOL framework explicitly. HMRC's own CEST tool has not been updated to reflect PGMOL, which means it continues to apply pre-2024 reasoning to MOO and BOOA. For contractors and clients who want a thorough and legally current assessment, a tool or adviser that engages with the PGMOL three-stage analysis is essential.

In particular, assessments should:

• Distinguish between basic and enhanced MOO - the mere existence of a contract is not enough for an employment finding
• Apply the three-stage framework, not a flat list of factors
• Give BOOA its proper weight as a holistic final test
• Reference Atholl House when assessing substitution, including unused rights