Mini-budgets, U-turns, and a large helping of dashed hope – it’s been a busy old time for the world of contract work, and for many, an incredibly disappointing one too.
The repeal of the IR35 rule would have seen contractors handed back the responsibility of deciding their own employment status, a move openly welcomed by plenty of employers and employees alike.
For recruiters everywhere, Jeremy Hunt’s decision to reverse the repeal was more than just a shock to the system, but rather, a threat to their working future, particularly as some organisations scramble to cut ties with contracts they organised to start after the repeal kicked in.
We asked our very own Viki Dowthwaite, Group Associate Director of Contract Recruitment for Trust in SODA, what she thought about the current IR35 landscape. Here’s what she had to say:
‘23rd September 2022…Most people will remember this as just another damp day in Autumn, but any Contractor or Contract Recruiter will remember this date as the day Kwasi Kwarteng and Liz Truss promised that the off-payroll rules would be repealed.
There was hope in the market that the “unnecessary cost and complexity” of IR35 was to be a thing of the past and contractors were thrilled to once again be responsible for determining their own employment status.
Businesses were delighted to free up their resources, time and money for other priorities. The many issues resulting from the reform like contractor bans and non-compliant blanket determinations would be a thing of the past…
The hope was short lived. Less than a month later, we saw Jeremy Hunt reverse the decision.
For clients, the continuation of these rules presents a long-term ambiguous job and a heck of an administrative burden…They will need to continue to assess each contractor’s individual working practices and how these affect the different IR35 markers, as well as the legal wording of any agreement. Surely it would make more sense for the person conducting those working practices and contracted by any agreement to advise on their own status?
The tool we have been given to conduct these assessments is not fit for purpose… As it stands, the CEST Tool is popping out 20% of Status Determination Statements with “Undetermined” and businesses have no further support or guidance provided by HMRC to enable them to make the final determination!
More often than not, particularly in the case of large organisations, agencies have to be led by the end client's approach to IR35. We can advise and educate on why they should take a practical approach and engage Outside IR35 contractors where appropriate, but ultimately, it is up to the end client and HMRC to adopt a more user-friendly approach.’
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