IR35: The Time to Prepare for 2020, is Today…

The much-anticipated Autumn Budget was released this week. As expected the changes to the IR35 legislation for the private sector were announced…. and thankfully it isn’t all doom and gloom (yet), as it won’t be brought into effect until April 2020.

There has been a lot of comment on social media which has got me thinking about how bad it will actually be, and what should people be doing now to ensure they’re prepared.

As lead for the Adecco Group UK&I’s public-sector recruitment business, I have had to become something of an expert in the complicated world of ‘disguised employment’ and HMRC’s new regulations. I would urge those expecting to be affected by IR35 not to let it become ‘out of sight out of mind’ and instead use this time to prepare.

I’ve recently spoken at a number of events with Gavin Tagg, General Counsel for our UK&I business, sharing the knowledge that we’ve acquired about the implementation of new IR35 rules in the public sector in 2017. I have had some fascinating discussions and gained insight from business experts across the UK. Best practice learned from the public sector has been shared along with the mistakes that need to be avoided when the rules are extended to the private sector.

There has been a lot of fear expressed around what these changes might mean for the contracting industry and this valuable flexible resource that UK business benefits from every single day. I am however certain that if managed correctly, the result can be a more robust and compliant set of solutions that deliver greater value in the long run. It will not be completely painless, but we can limit the fallout, starting by having an accurate understanding of the new requirements and how they work in practice. Above anything else though, allowing enough time to prepare properly is imperative.

By the end of this change I am sure that we will retain the highly-skilled freelancers, but working practices will have evolved to allow them to be true consultants and really define what work they have been brought in to do. In the public sector we are seeing many more ‘statement of work’ opportunities. Contractors are engaged in a far more output-driven way and we are seeing customers really consider what ‘Supervision, Direction and Control’ really means and in what circumstances a substitution might genuinely be allowed (as opposed to simply a clause in the contract).

The Adecco Group is doing some great work, internally and with independent industry experts to support our private sector colleagues with the coming implementation of the new IR35 rules. We can help to prepare your organisation for the inevitable transition this will bring. While a year might seem a long time, I would strongly urge both contractors and clients not to wait until this time next year before considering what it means in specific circumstances. On that path lies chaos!

For those of us working in the public sector, what do you wish you had known about IR35 a year ahead of its implementation?

Simon Crichton

Author: Simon Crichton
Current: Senior Vice President Badenoch + Clark, Adecco Group UK & Ireland
Education: The University of Manchester