Sky's current thrust

[LondonManc]

Will be interesting to see how that pans out. I would use the term Samsung loosely as it maybe the case that only a couple of contractors on certain teams are given outside IR35 contracts, but the fact they've got QDOS involved is a very good sign.



Sky's approach has been fairly good. They've offered the 'good' contractors they want to keep a salary + bonus which is equivalent to their daily rate outside of IR35.

Jeepers, that's a very good offer.

[simes]

Will be interesting to see how that pans out. I would use the term Samsung loosely as it maybe the case that only a couple of contractors on certain teams are given outside IR35 contracts, but the fact they've got QDOS involved is a very good sign.

Sky's approach has been fairly good. They've offered the 'good' contractors they want to keep a salary + bonus which is equivalent to their daily rate outside of IR35.

Well, having just touched base with said Samsung friend, it seems his 'department' have chucked the towel in too.

The talks with Qdos have come to nought and they too are all getting chucked Inside. Seems there are some decision makers in Samsung who are caring not to understand the deal and have just said zero risk.

Having queried this, since Qdos were seemingly offering just that (Template contracts, advice how to maintain parity between contract and working condition, Insurance thereafter) I, and he, do not understand how this can Not be zero risk.

A right bloody mess, to be sure.

Having touched base with the Sky friend, yes. He too is being offered a perm role. No contractors.

Top job, HMRC. From these two cases, zero increase in tax collections.

[jamesbrown]

Having queried this, since Qdos were seemingly offering just that (Template contracts, advice how to maintain parity between contract and working condition, Insurance thereafter) I, and he, do not understand how this can Not be zero risk.

It isn't zero risk because there are all sorts of potential problems for a client to declare "you've been working here for a long time as a contractor without employment rights, but now we accept that you looked an awful lot like an employee for tax purposes and, by the way, the case law is the same".

Holidays.

Pensions.

Etc.

Not to mention that the determination could be wrong or that the contractor could appeal. It's just a lot of hassle and unknown risk.

Much simpler to work with employees, going forward, than employees-for-tax-purposes.

[simes]

It isn't zero risk because there are all sorts of potential problems for a client to declare "you've been working here for a long time as a contractor without employment rights, but now we accept that you looked an awful lot like an employee for tax purposes and, by the way, the case law is the same".

Holidays.

Pensions.

Etc.

Not to mention that the determination could be wrong or that the contractor could appeal. It's just a lot of hassle and unknown risk.

Much simpler to work with employees, going forward, than employees-for-tax-purposes.

While I appreciate the thinking, the case law here is not new. Qdos, and their experience with the same issues when defending contractors will, I am perfectly sure, have all of the issues above covered.

Were this to be new law, with unknowing clients, and insurers thereof all just seeing this for the first time as a twinkle in their profit making eye, I believe your point(s) would be valid.

But Qdos are hardly newbies to all this. The clients however are. Bless 'em.

[jamesbrown]

While I appreciate the thinking, the case law here is not new. Qdos, and their experience with the same issues when defending contractors will, I am perfectly sure, have all of the issues above covered.

Were this to be new law, with unknowing clients, and insurers thereof all just seeing this for the first time as a twinkle in their profit making eye, I believe your point(s) would be valid.

But Qdos are hardly newbies to all this. The clients however are. Bless 'em.

Wait, this isn't about risk to the contractor. This is about commercial risk to the client, probably a long time into the future. Nothing to do with Qdos or IR35 or IR35 case law.

[simes]

Wait, this isn't about risk to the contractor. This is about commercial risk to the client, probably a long time into the future. Nothing to do with Qdos or IR35 or IR35 case law.

Correct me if I am wrong. You might be misunderstanding me.

Qdos were brought in to indemnify the client in this case. NOT the contractor. So Qdos's experiences in IR35 law while defending contractors will surely be put to use for the brave new world in defending clients.

To clarify and state, Qdos are now introducing themselves to Clients to shore up contract writing and working conditions to protect Clients, post April 2020.

Hope that helps any misunderstanding or lack of clarity on my part.

...And in a separate post, a follow up from said Samsung friend.

[simes]

This from Samsung friend.

"Qdos were brought in by the agency to look at our contracts (as long as we paid) and discuss with Samsung about ir35.

We were told that if Qdos found us outside ir35, they would indemnify Samsung against all claims and the contractors would have their insurance in case of any investigation. As it turns out, Qdos sent our questionnaire answers to the manager closest to those on the ground. This is a permie of Samsung that felt they couldn't agree with our answers and started quoting the employee policy.

This guy had never even seen the contract we signed so he had no clue what he was doing. He was basically protecting himself from an investigation in case they pointed a finger to say he approved all that.

We had many arguments with him about him rejecting our answers even though we showed him it was in our contract. For stuff not in our contract, he would again quote the employee policy. We kept pointing out that we signed up to our contract and not the employee contract.

Anyway, it was all null and void once the UK president stepped in and said he wanted 0% risk and told everyone to go through an umbrella company.

If you know the hierarchy of a Korean company, there's 0% chance of talking to your boss once he has announced his decision. That's when our arguments simply fell on deaf ears.

Qdos were going to indemnify Samsung and insure the contractor against investigation if we were declared outside ir35 for as long as we stayed at Samsung and the contract basically stayed the same. The insurance was being given based on the contract. As long as the contract didn't change, even through renewals, we were going to be covered."

Needless to say, I am empathetic.

To clarify, I know this chap well. He is Outside IR35 all the way, both contract and practices-wise. HMRC's statement of this not affecting real contractors is a royal crock; gold plated, hall marked on every corner and lit up across the estate.

Clearly there is going to be a need for a single client to go through, and to have successfully Gone through, an investigation before clients nationally, have the chops to grow a pair and feel they have the wherewithal to stand up to the HMRC.

We might be a ways off...

[jamesbrown]

Correct me if I am wrong. You might be misunderstanding me.

Qdos were brought in to indemnify the client in this case. NOT the contractor. So Qdos's experiences in IR35 law while defending contractors will surely be put to use for the brave new world in defending clients.

To clarify and state, Qdos are now introducing themselves to Clients to shore up contract writing and working conditions to protect Clients, post April 2020.

Hope that helps any misunderstanding or lack of clarity on my part.

...And in a separate post, a follow up from said Samsung friend.

OK, useful clarification, but my point still stands that the scope of the FUBAR that can befall a client is way beyond the immediate issue of taxes and, presumably, Qdos were only advising on IR35 compliance.

How are Qdos going to indemnify a client against loss of reputation, regulatory failures, retrospective claims of employment benefits, etc.? There's too much risk involved in classifying workers for tax purposes. Better to avoid the problem altogether and create actual employees, which is what most large clients (esp. in heavily regulated sectors) seem to be doing.

[simes]

OK, useful clarification, but my point still stands that the scope of the FUBAR that can befall a client is way beyond the immediate issue of taxes and, presumably, Qdos were only advising on IR35 compliance.

How are Qdos going to indemnify a client against loss of reputation, regulatory failures, retrospective claims of employment benefits, etc.? There's too much risk involved in classifying workers for tax purposes. Better to avoid the problem altogether and create actual employees, which is what most large clients (esp. in heavily regulated sectors) seem to be doing.

Still not sure you've got me, or maybe I am way off course.

But, in the immediate present and soon to be past, Qdos have indemnified contractors against HMRC investigations, court cases and IR35 related losses based on their reviewing of contracts and conditions.

Presumably, Qdos are offering the same to clients.

Qdos say to the client;

1. Let us review / write the contracts.
2. Ensure that you (the client) maintain working conditions per contract.
3. Accept and pay the annual insurance premium. (As have contractors paid to Qdos and IPSE)
4. And, if you (the client) get investigated, we will assign a lawyer and see you right.

Not sure how else to explain this as it is a carbon copy of that which has been presented to and used by contractors for the past 20 years...

As for loss of reputation, who gives a flying FUBAR about that? Have contractors felt loss of reputation as being an issue when facing up to the HMRC? On the contrary, I am bloody sure they have been as happy as a knock kneed whelk on a long weekend, and only too happy to have shouted from the roof tops as to their successes against the jolly green giant.

Got it?

[jamesbrown]

Still not sure you've got me, or maybe I am way off course.

But, in the immediate present and soon to be past, Qdos have indemnified contractors against HMRC investigations, court cases and IR35 related losses based on their reviewing of contracts and conditions.

Presumably, Qdos are offering the same to clients.

Qdos say to the client;

1. Let us review / write the contracts.
2. Ensure that you (the client) maintain working conditions per contract.
3. Accept and pay the annual insurance premium. (As have contractors paid to Qdos and IPSE)
4. And, if you (the client) get investigated, we will assign a lawyer and see you right.

Not sure how else to explain this as it is a carbon copy of that which has been presented to and used by contractors for the past 20 years...

As for loss of reputation, who gives a flying FUBAR about that? Have contractors felt loss of reputation as being an issue when facing up to the HMRC? On the contrary, I am bloody sure they have been as happy as a knock kneed whelk on a long weekend, and only too happy to have shouted from the roof tops as to their successes against the jolly green giant.

Got it?

What part of "more than tax at stake" are you not following? Are they insuring for compliance failures? No. Are they insuring for backdated pension contributions and employment benefits? No.

No large corporate is going to rely on some half-baked IR35 insurance that covers a fraction of a liability that they don't even understand. Kill the risk. What they're doing makes perfect sense to me. It doesn't to you, but I don't see why that matters...