Government review branded ‘meaningless’, ‘inadequate’ and ‘too late’.

IR35 review reaction.

There has been an overwhelmingly negative reaction to the Government’s review of the Off-Payroll legislation from the recruitment and staffing industry. As the Government proposals are limited to round tables in London and will not include any changes to the legislation itself many are questioning the point of this exercise. Julia Kermode, FCSA’s chief executive describes the review as “meaningless” coming from a Government “who seems intent on bulldozing ahead with its plans”. 

Among other criticism she notes the timetable of the review: “They are expecting the review to be completed by mid-February which is simply not long enough to consider the deeply complex range of issues that the Off-Payroll legislation is throwing up. HMRC has stated that they will be continuing its preparations to roll out the reforms in April come what may. We have also learned today that the review will focus on the implementation of the reforms rather than the reforms themselves which is not what was suggested and is not what is needed. I fear that today’s pledge is simply the Government paying lip-service to empty election promises and nothing short of an insult.”

Andy Chamberlain, deputy director of Policy at IPSE (the Association of Independent Professionals and the Self-Employed) was equally scathing of the review calling it “disappointingly hasty and inadequate.”

“Not only has the government not said it will pause the changes, it has also allocated far too little time for a full review and said nothing about selecting an independent chair,” he says. “Such a limited review would leave the freelance sector floundering. Right now, across the sector, contractors and freelancers are panicking at the prospect of these disastrous changes.

“Major businesses, including most of the large banks, have already announced they will no longer engage contractors out of fear they will fall foul of the notoriously complex legislation. Even before the new rules take effect, they are precipitating a crisis among the self-employed.”

Chamberlain added: “During the election, Sajid Javid said the Conservatives were ‘on the side of the self-employed’. It must not be one of the first acts of this government to let this commitment slide.”

Tania Bowers, Legal Counsel at the Association of Professional Staffing Companies expressed APSCo’s disappointment that there was no intention of delaying incoming changes. “APSCo has called for implementation to at least be delayed pending a further impact review and completion of an assessment on employment status,” she said. “There is a clear need for a proper review, with adequate time to publish the outcome and recommendations of the review, and then roll out changes with certainty on final legislation. This timeline just doesn’t work.

“We, of course, support HMRC’s intention to ‘ensure smooth implementation of the reforms’,” she added, “We also welcome further internal analysis of the CEST tool. However, the reality is that this review – at this time – is likely to create even more confusion.

“Essentially, with just weeks to go until the changes are implemented, we are now at a point where we don’t have any certainty around final legislation or any firm guidance from HMRC. New rules apply from March for firms running monthly payrolls – this eleventh-hour review is simply too late.”

Speaking from within the industry Charlie Cox, commercial manager at SThree, said: “The ‘review’ was promised by most political parties pre-election as a vote winning move. It’s nothing more than a box ticking exercise. HMRC have stated that the review will determine if any further steps can be taken to ensure the smooth and successful implementation of the reforms. The chances of the reforms not happening are slim to none unfortunately and it’s vital, as we’ve been saying for a long time now that UK businesses and contractors ensure they understand the legislation, are prepared for it and are working with compliant suppliers who understand the legislation. Those who get this right, will make themselves attractive to the best talent on the market and have the pick of highly skilled contractors.”

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Accept Read More