The changes in IR35 legislation has seen PAYE umbrella enterprise, Cool Company, report a 388 per cent uplift in contractor sign up in March 2021 compared to 12 months earlier.
Operating in Sweden, Norway, and the UK, the growth in contractor uptake for Cool Company has been solid since its foundation. However, in the last three months, despite the Covid-19 pandemic, contractor sign ups have skyrocketed. In January 2021, the company reported a 50 per cent year on year uplift in signups. In February, that figure climbed sharply to 217 per cent. Peaking at 388 per cent in March. This increase has been seen across sectors, with particularly strong results in the recovering creative and IT sectors, making up 32 per cent and 8 per cent of users, respectively during 2021.
“Almost all businesses took a hit during the pandemic, and contractors were some of the first impacted,” said Cool Company’s head of business, Kris Simpson. “However, things have changed rapidly since then. Covid-19 has ushered in a new way of working, more businesses are seeing the potential of contractors.
“This, coupled with the implementation of the new IR35 legislation, has meant that more contractors are shifting to umbrella solutions and recruiters are looking for a simple solution to IR35 compliance when placing contractors,” he says. “While this will initially be due to caution – not wishing to fall foul of the new regulations – umbrella companies also provide the security that many freelance and contract workers miss. Allowing the freedom of choice that comes with self-employment, while removing the red tape headache.”