IR35 – Retain and attract key talent by being prepared
At Brookson Legal, we are really pleased to see a growing number of End-Hirers refocusing their efforts on IR35 and getting ahead of the game, in advance of the IR35 implementation in the Private Sector in April 2021.
Over the last couple of weeks, we have started the review process with a number of clients who are looking to reassess roles that were previously assessed in the run up to the April 2020, in addition to undertaking new assessments for new contractors and roles.
It is great to see End-Hirers tackling their IR35 obligations head on and starting their IR35 preparation activity even earlier than they did last year. This supports our belief that the experience our clients gained in early 2020 is really going to pay off for those who engage earliest this time around. A considerable amount of time and effort needs to be afforded to the IR35 project, in order to ensure that End-Hirers are meeting their Reasonable Care requirements, and putting themselves in the best possible shape to attract and retain talent within their organisations.
The End-Hirers we’re engaging with, who are now putting themselves in a position to capitalise on IR35, want to become ‘Talent Magnets’ within their sector. Starting now gives End-Hirers enough time to understand how all their roles look from an IR35 perspective and how much work is required to ensure roles are categorised correctly. Time will shortly be running out, but starting sooner rather than later will enable End-Hirers to make informed and considered changes to contracts and iron out working practices, to enable much stronger retention levels and attraction of the most highly skilled workers.
This is clearly the best approach to take, as we observed in the lead up to April 2020, those End-Hirers who left it late to act and who were unwilling to consider changes to how they engage contractors, found themselves being inundated with threats of employment tribunal claims, informal challenges and contractors walking out on the job.
THE COST OF GETTING IT WRONG
Not only does failing to act now expose End-Hirers to losing contractors and leave them unable to attract new workers (which has the obvious impact on projects being delayed and not delivered on time), but it can also expose you to not meeting your Reasonable Care obligations and HMRC holding you liable for Tax, NICs and Apprenticeship Levy, plus penalties and interest. Our clients are actively trying to avoid a perceived ‘snowball effect’, which could quite quickly spiral out of control.
OUR NEW IR35 PORTAL
Over the last few months, we have been working on a new IR35 Portal. The Portal allows Brookson Legal’s IR35 Specialists to complete IR35 reviews efficiently and where roles are initially categorised as ‘Amber’, lead to a healthy discussion on any reasonable adjustments that can be made to facilitate an informed decision on statuses. Furthermore, the Portal retains information, allowing for Status Determination Statements to be stored in one central repository and ensures that all reviews continue to be undertaken by IR35 specialists, rather than automated computer algorithms.
SUMMARY
It is clear that the so-called ‘IR35 Headache’ will be prolonged for those End-Hirers who fail to act soon, whilst for those organisations who have already started undertaking assessments it will pass quickly, allowing them to reap the rewards and scoop up the brightest talent in the market.