Contractors: IR35 & general discussion

[tighnamara]

PostHeads123 said:

Lots of discussion on this thread about the rights and wrongs of it all, such discussion has been going on for yearrrrrrssss.. the reality is,

1. Its happening.
2. The big clients users don't really care and will just not work with PSC anymore and will use this as an excuse to move work to other locations and will expect the contractors to suck it up.
3. There will be outside IR35 contracts but competition for these will be HIGH.
4. Some contractors who think they are still worth X will need a reality check as the good days are over.
5. Things will settle down but imo its the contractors who will have to adapt the clients don't care.

Edited by PostHeads123 on Monday 17th February 12:27

Not sure it is going to be plan sailing for certain industries, those deemed in scope (PAYE) will be entitled to the same working hours as staff. This may be straightforward but the roles do require additional time (over the 37.5hr week) spent in office / working from home when operational.

Staff are entitled to flexi time so build up their hours to take 2 flexi days a month, this will not be made available to PAYE contractors so any additional hours worked will not be paid.

I don't know many (if any) contractors who would be willing to work additional time under PAYE contract when staff are getting additional days off but contractors nothing.
Previously as PSC they would work to get what was required and ensure operations continued, this will change going forward unless there is a fair playing field.

Lots of issues still to come out on the employment side.................little thought has been put into these.

Edited by tighnamara on Monday 17th February 14:39

[Carl_Manchester]

in response to the above i will repeat that :

Clients will play hard ball publicly, privately they will be concerned that although inflation has not affected contractor day rates and perm salaries too much, it has affected professional services day rates.

the day rate card from some of the usual suspects start at £2300 per day now, not £1250 and that’s for low experience consultants.

Whatever happens next, if the current course remains it will cause perm salary and contractor day rate inflation in the medium to long term.

[Countdown]

tighnamara said:

Not sure it is going to be plan sailing for certain industries, those deemed in scope (PAYE) will be entitled to the same working hours as staff. This may be straightforward but the roles do require additional time (over the 37.5hr week) spent in office / working from home when operational.

Staff are entitled to flexi time so build up their hours to take 2 flexi days a month, this will not be made available to PAYE contractors so any additional hours worked will not be paid.

I don't know many (if any) contractors who would be willing to work additional time under PAYE contract when staff are getting additional days off but contractors nothing.
Previously as PSC they would work to get what was required and ensure operations continued, this will change going forward unless there is a fair playing field.

Lots of issues still to come out on the employment side.................little thought has been put into these.

IME flexi isn't that common is the private sector and 40 hours seems more common than 37.5. The "standard weekly hours" thing also tends to be more for junior staff rather than management. Otherwise "it's the hgours needed to get the job done". I know at busy times (month end/year end) people in my team will be working 50-60 hours per week.

However if you're PAYE then you should have an employment contract, and that will automatically give you the same rights as a permie.

[Countdown]

Carl_Manchester said:

the day rate card from some of the usual suspects start at £2300 per day now, not £1250 and that’s for low experience consultants.

Whatever happens next, if the current course remains it will cause perm salary and contractor day rate inflation in the medium to long term.

I'm surprised they're that high. We are paying <£1,000 per day for SAP S/4HANA Consultants in Manchester and £2,000 for a Big 4 Partner.

[tighnamara]

Countdown said:

IME flexi isn't that common is the private sector and 40 hours seems more common than 37.5. The "standard weekly hours" thing also tends to be more for junior staff rather than management. Otherwise "it's the hgours needed to get the job done". I know at busy times (month end/year end) people in my team will be working 50-60 hours per week.

However if you're PAYE then you should have an employment contract, and that will automatically give you the same rights as a permie.

I am not deemed in yet............currently assessed out but think things could change to a blanket.

The end user I am with currently work a 37.5 hr week with any additional hours worked building up to 2 days additional off a month, so basically an additional 24 days a year holiday.

Those that have been deemed in and PAYE are not being offered the flexi time only the 37.5 hr working week but expected to work additional hours whilst their peers that are staff are able to build up additional time off.

[aeropilot]

tighnamara said:

Countdown said:

IME flexi isn't that common is the private sector and 40 hours seems more common than 37.5. The "standard weekly hours" thing also tends to be more for junior staff rather than management. Otherwise "it's the hgours needed to get the job done". I know at busy times (month end/year end) people in my team will be working 50-60 hours per week.

However if you're PAYE then you should have an employment contract, and that will automatically give you the same rights as a permie.

I am not deemed in yet............currently assessed out but think things could change to a blanket.

The end user I am with currently work a 37.5 hr week with any additional hours worked building up to 2 days additional off a month, so basically an additional 24 days a year holiday.

Those that have been deemed in and PAYE are not being offered the flexi time only the 37.5 hr working week but expected to work additional hours whilst their peers that are staff are able to build up additional time off.

What a surprise......

[bonerp]

aeropilot said:

What a surprise......

I won't be doing this anymore. My end client expects me to work out of hours yet want me taxed like a permie (who doesn't). They can do one. Work to rule now my friends. I'm classed as a permie so I'll behave like a permie

[Carl_Manchester]

Countdown said:

Carl_Manchester said:

the day rate card from some of the usual suspects start at £2300 per day now, not £1250 and that’s for low experience consultants.

Whatever happens next, if the current course remains it will cause perm salary and contractor day rate inflation in the medium to long term.

I'm surprised they're that high. We are paying <£1,000 per day for SAP S/4HANA Consultants in Manchester and £2,000 for a Big 4 Partner.

I used to work in PS about 10 years ago, solution architects were £1,650 back then but that included all flights and hotels. 40% margin. We were actually at the bottom end of group margin, as is the case for Software Firms.

Actually, if you stick £1,650/2008 into the inflation calculator, you do come up with £2,400 in 2019 which is the base rate for many of the firms.

[Clockwork Cupcake]

tighnamara said:

Those that have been deemed in and PAYE are not being offered the flexi time only the 37.5 hr working week but expected to work additional hours whilst their peers that are staff are able to build up additional time off.

It was this kind of st that pushed me into contracting in the first place, 20-odd years ago, and I'll be damned if I'm going to start putting up with it again now.

[aeropilot]

bonerp said:

aeropilot said:

What a surprise......

I won't be doing this anymore. My end client expects me to work out of hours yet want me taxed like a permie (who doesn't). They can do one. Work to rule now my friends. I'm classed as a permie so I'll behave like a permie

Other way around for me in my industry.

The permie's get shafted by having to do shed loads of extra hours for no O/T payments. They get conned into being offered time off in lieu, which of course they can never take as everyone is too busy, so they end up doing for nothing.
As contractors, we got paid for the hours we did, So if they wanted us to do more, they had to pay for it, which they never did, so we didn't do it. It was one of the reasons I enjoyed being a contractor rather than a permie, and why I don't want to go back to all that st.....
I want to work less hours as I get nearer to retirement, not more. Well that was the plan, until all this st happened.

[Countdown]

aeropilot said:

Other way around for me in my industry.

The permie's get shafted by having to do shed loads of extra hours for no O/T payments. They get conned into being offered time off in lieu, which of course they can never take as everyone is too busy, so they end up doing for nothing.
As contractors, we got paid for the hours we did, So if they wanted us to do more, they had to pay for it, which they never did, so we didn't do it. It was one of the reasons I enjoyed being a contractor rather than a permie, and why I don't want to go back to all that st.....
I want to work less hours as I get nearer to retirement, not more. Well that was the plan, until all this st happened.

I thought one of the signs of being a Contractor was that you were contracted to do a specific job, the scope and price were determined at the outset and payment was fixed regardless of the hours worked?

[Clockwork Cupcake]

aeropilot said:

As contractors, we got paid for the hours we did, So if they wanted us to do more, they had to pay for it, which they never did, so we didn't do it. It was one of the reasons I enjoyed being a contractor rather than a permie, and why I don't want to go back to all that st.....
I want to work less hours as I get nearer to retirement, not more. Well that was the plan, until all this st happened.

Yup. Exactly what I was saying.

[aeropilot]

Countdown said:

aeropilot said:

Other way around for me in my industry.

The permie's get shafted by having to do shed loads of extra hours for no O/T payments. They get conned into being offered time off in lieu, which of course they can never take as everyone is too busy, so they end up doing for nothing.
As contractors, we got paid for the hours we did, So if they wanted us to do more, they had to pay for it, which they never did, so we didn't do it. It was one of the reasons I enjoyed being a contractor rather than a permie, and why I don't want to go back to all that st.....
I want to work less hours as I get nearer to retirement, not more. Well that was the plan, until all this st happened.

I thought one of the signs of being a Contractor was that you were contracted to do a specific job, the scope and price were determined at the outset and payment was fixed regardless of the hours worked?

Never possible in my industry, clients would never allow it as they want all the cake, all the time and still do. Mention of IR35 would be met by, whats that, don't care, take it or leave it.

And guess what, now they have to try and understand IR35, we will still get shafted, as they can have their cake and eat it twice over.

I don't know what nice little world you live and work in, but its not mine.

[Countdown]

aeropilot said:

Countdown said:

aeropilot said:

Other way around for me in my industry.

The permie's get shafted by having to do shed loads of extra hours for no O/T payments. They get conned into being offered time off in lieu, which of course they can never take as everyone is too busy, so they end up doing for nothing.
As contractors, we got paid for the hours we did, So if they wanted us to do more, they had to pay for it, which they never did, so we didn't do it. It was one of the reasons I enjoyed being a contractor rather than a permie, and why I don't want to go back to all that st.....
I want to work less hours as I get nearer to retirement, not more. Well that was the plan, until all this st happened.

I thought one of the signs of being a Contractor was that you were contracted to do a specific job, the scope and price were determined at the outset and payment was fixed regardless of the hours worked?

Never possible in my industry, clients would never allow it as they want all the cake, all the time and still do. Mention of IR35 would be met by, whats that, don't care, take it or leave it.

And guess what, now they have to try and understand IR35, we will still get shafted, as they can have their cake and eat it twice over.

I don't know what nice little world you live and work in, but its not mine.

What about MOO? You're not obliged to take on the extra work, are you?

[worsy]

Some of the crap being posted on linked in is starting to make me lose patience with contractors, and I was one two months ago.

https://www.linkedin.com/posts/ashishkulkarni_ir35...

[Olivera]

worsy said:

Some of the crap being posted on linked in is starting to make me lose patience with contractors, and I was one two months ago.

https://www.linkedin.com/posts/ashishkulkarni_ir35...

I suspect his numbers aren't entirely correct, but his argument of punitive taxation but no employment rights holds water.

[worsy]

Olivera said:

worsy said:

Some of the crap being posted on linked in is starting to make me lose patience with contractors, and I was one two months ago.

https://www.linkedin.com/posts/ashishkulkarni_ir35...

I suspect his numbers aren't entirely correct, but his argument of punitive taxation but no employment rights holds water.

Numbers are way out. The argument is wrong though IMO, it should be about benefits to the economy, flexibility etc not a bunch of people whinging because they are losing 14.8% of their 100k salary.

[Olivera]

worsy said:

Numbers are way out. The argument is wrong though IMO, it should be about benefits to the economy, flexibility etc not a bunch of people whinging because they are losing 14.8% of their 100k salary.

I don't believe the numbers are way out, if we account for employers NI, apprenticeship levy, paying for your own pension and holidays, a sizeable amount of travel costs, then they are probably quite representative.

I also fundamentally disagree that the argument is incorrect. In fact it's entirely correct - why should I be taxed as an employee when I receive none of the benefits nor employment rights?

[Clockwork Cupcake]

worsy said:

not a bunch of people whinging because they are losing 14.8% of their 100k salary.

Why don't you voluntarily pay more tax then? Be a hero and benefit the economy.

Also, there's a huge difference between a £100k turnover and a £100k salary. As an ex-contractor you ought to know that.

Edited by Clockwork Cupcake on Monday 17th February 18:15

[GT03ROB]

Clockwork Cupcake said:

Also, there's a huge difference between a £100k turnover and a £100k salary. As an ex-contractor you ought to know that.

Of course there is........ however......... for years now contractors have been shouting lodasmoney at the staffers, waving their turnover as if it's salary. A lot of contractors have been treating it as salary too. Hence the gnashing of teeth & moans about staffers getting holiday pay while contractors don't pre-IR35.