Agency making contractors employees?

[PerfectStorm]

Have heard of a company who, rather than making contractors 'inside' (or indeed outside) is specifying that all agency supplied workers must be employees of the agency

Is this a dodge/workaround to get around giving people IR35 determinations or is it just the same thing?

Are there any potential downsides/upsides to be aware of?

[LondonManc]

Have heard of a company who, rather than making contractors 'inside' (or indeed outside) is specifying that all agency supplied workers must be employees of the agency

Is this a dodge/workaround to get around giving people IR35 determinations or is it just the same thing?

Are there any potential downsides/upsides to be aware of?

Sounds like a dodge.

No contractors = no IR35 decisions required
Agency has to make contractors permie, leaving the negotiation between contractor(?) and agent. That said, this could lead to FTCs at hefty salaries being a longer term future. Nobody will be anywhere past 23 months, massive tax take for HMRC, contractors on decent rates, potential for good expense claim opportunities too. The more I think about it, the more I think that it could be a very good solution all round. Agency would also want a bigger wedge but flip side is that they can get that off the client because of the IR35 hassle savings.

[PerfectStorm]

Sounds like a dodge.

No contractors = no IR35 decisions required
Agency has to make contractors permie, leaving the negotiation between contractor(?) and agent. That said, this could lead to FTCs at hefty salaries being a longer term future. Nobody will be anywhere past 23 months, massive tax take for HMRC, contractors on decent rates, potential for good expense claim opportunities too. The more I think about it, the more I think that it could be a very good solution all round. Agency would also want a bigger wedge but flip side is that they can get that off the client because of the IR35 hassle savings.

Not sure the client is saving anything from reduction in IR35 hassle are they? If they're used to shelling out X a day for a role, they'll want to continue to do so where possible. This means that either the (former) contractor or agency must lose out to offset the extra tax take. Or the client pays more for what they're used to, and they probably have the most leverage.

[TestMangler]

Not sure the client is saving anything from reduction in IR35 hassle are they? If they're used to shelling out X a day for a role, they'll want to continue to do so where possible. This means that either the (former) contractor or agency must lose out to offset the extra tax take. Or the client pays more for what they're used to, and they probably have the most leverage.

Wanna take a guess which ??

[northernladuk]

I posted about this not so long ago.

https://www.contractoruk.com/forums/...tml?highlight=

This practice needs to die in flames quickly.