Election 2019: Recruitment sector calls for fast action on IR35 and job protection.
REC, APSCo and FCSA react.
The result of the general election has brought some early response from the recruitment industry. Neil Carberry, Chief Executive of the Recruitment and Employment Confederation, commented: “Boris Johnson’s team must now focus on stability, investment and growth in our economy. Business confidence in the economy is at a low point and job creation is slowing as our research clearly shows. A no deal Brexit would be disastrous for jobs and must not be allowed to happen. The Brexit transition period must now be put into action and a realistic plan put in place for long-term trading arrangements, including for services – a critical part of our economy.
He goes on to add: “The biggest challenge to growth is skills shortages. The nation’s productivity hinges on government’s ability to address this. One huge opportunity is to open up the apprenticeship levy to the millions of people who choose flexible work. But for the sick to be treated, for homes to be built, and for food to be produced, the UK also needs an immigration system that meets employers’ needs for skills at all pay-levels – not just ‘the brightest and the best’.
“Few things matter more to people’s daily lives than the work that they do – the government must act now to underpin the jobs of the future. While we welcome the Conservatives’ promise to review the IR35 tax reform, it is wholly unfit for purpose and implementation must be delayed.”
The IR35 issue is echoed by others across the industry. “With Boris Johnson returning to Number 10 this morning I would like to remind him and his government that they have promised to review the planned off-payroll reforms,’ said Julia Kermode, chief executive of The Freelancer & Contractor Services Association (FCSA). “We must now hold him to account and press him to conduct that review and with only just over three months to go before the legislation is due to be rolled-out in the private sector, surely that must mean a postponement?
“We are already seeing the very real impact of this damaging legislation on businesses and thousands of professionals,” she said. “If they don’t delay then the promise was nothing short of an arrogant and disingenuous move to secure votes.”
Kermode also says the budget now appears to be planned for February/March which is too late for the off-payroll legislation to be properly implemented. “Many businesses have already invested heavily in preparing for the changes, and given the legal requirement for reasonable care it is unrealistic to press pause for a potentially meaningless review to take place,” she says. “If the government wants to avoid utter chaos and shambles, businesses need clarity NOW.”
APSCo’s Legal Counsel, Tania Bowers, also highlights Sajid Javid’s promise to review how the government could further help the self-employed, including the proposed changes to IR35. “We welcome this commitment whole-heartedly,” she says. “Indeed, in APSCo’s own manifesto, we have called for a rethink on off-payroll working in the private sector, which we believe should, at least, be delayed pending completion of an assessment on employment status.”
“In terms of future migration policy, our members will welcome the Government’s commitment to ‘attract the best and brightest from all over the world’. Although an ‘Australian-style’ points-based system would, in theory, remove barriers for highly skilled professionals, APSCo maintains that we need a system which is sufficiently flexible to enable those without a permanent job offer to live and work in the UK. In our own manifesto, we have called for a dedicated visa route as part of the future skills-based immigration system, through which highly skilled contractors from overseas can come and support British businesses.”
Finally, Bowers expresses some issue with the government’s approach on Brexit: “We are somewhat concerned that the Conservatives have drawn a line in the sand and confirmed that they will not extend the implementation period beyond December 2020. We believe this increases the risk of no free trade agreement – effectively creating a no deal scenario – which will not be favoured by the majority of our members.”