Why top stars set up their own companies
Why would RTÉ's top talent (or talent in any organisation) choose to set up a company and independently contract their services rather than remain a PAYE employee?
There are several reasons, but the main benefit is vastly increased earning power.
By setting up a company and operating as a limited contractor, you can avoid pay scales that apply to most employees.
The independent contractor operates a separate business entity and is not considered an employee, a critical distinction for the Revenue Commissioners.
As well as negotiating better working conditions, flexible hours and a higher income, being an independent contractor, or separate business entity, allows workers to better manage their tax and pension contributions.
There are drawbacks. Independent agents are not protected by many of the laws that protect PAYE employees, such as unfair dismissal laws, and although top talent may have more money and greater financial control, they lose out in the likes of jobseekers' allowance or illness benefit.