Contractors' Questions: Who signs confirmation of work arrangements?

Contractor’s Question: Concerned about IR35, I presented a confirmation of working arrangements to my client.

The client has advised that they cannot sign the arrangements off as they have a contract directly with the agency and not with me. Can my agency approve the CoA without the client approval? Who is the right party to approach to get the CoA accepted?

Expert’s Answer: It is unclear from your enquiry what, precisely, ‘confirmation of working arrangements’ means here, although the word arrangements suggests this is something agreed before the event rather than after, i.e. prior to the commencement of the actual services, not after commencement.

Fundamentally, the extent to which a contractor and hirer have direct communications and can agree matters concerned with a project should be set out in the relevant terms (contractor-agency; agency to hirer).

Subject to the contracts, as regards signing off ‘confirmation of working arrangements’, if this refers to an agreement as to what a project will entail then it would be perfectly appropriate for this to be discussed between the parties, as it could establish the nature of what is intended to be the greater project. This is on the proviso that the confirmation stage had been intended in the first place. If the terms of the relevant contracts dictate that any such discussions must be agreed first through the agency, then of course that process must be followed.

If, however, the meaning of ‘confirmation of working arrangements’ in your scenario is akin to the signing off of milestones, deliverables or even a timesheet then (again subject to the terms of the relevant contracts), it would be appropriate for a party on-site in receipt of those services to sign this off as the agency would not be in any position to do so, in most cases. In such circumstances, this should have no bearing on IR35 status as it is commercial necessity for the client hirer to be satisfied with the work/outline of works.

The expert was Ben Grover, senior legal consultant at Lawspeed Limited, experts on IR35, including the new public sector rules.

 

Thursday 27th April 2017