Uber’s workforce must now be classified as ‘workers’ rather than ‘self-employed’, the Supreme Court has ruled in a landmark employment tribunal.
UK political parties pledge IR35 review
The general election is fast approaching. With self-employment high on the agenda, several key political figures have suggested a review of off-payroll rules.
Sajid Javid, Chancellor of the Exchequer, has promised a full review of IR35 by the Conservative party as part of their manifesto to help self-employed people in the UK. He’s the latest of the main parties to acknowledge that change might be needed.
In an interview for BBC Radio 4’s Money Box show, Javid said, “I want to make sure that the proposed changes are right to take forward”.
“We’ve already said that we’re on the side of self-employed people. We will be having a review, and I think it makes sense to include IR35 in that review”.
Other political parties have always stated their intentions with regards to IR35. Bill Esterson, Labour’s shadow small business minister, was in the news last week after suggesting that they would scrap the private sector extension to IR35 in the UK. He later retracted these comments, explaining that Labour’s policy would be to review IR35 changes, not scrap them entirely.
The Lib Dems also announced plans to end retrospective tax review recent proposals to change the IR35 rules”. In their manifesto, ‘‘Stop Brexit: Build a Brighter Future’, they also pledge to ensure the fair treatment of people and businesses by ending controversial initiatives like the Loan Charge.
A large proportion of the self-employed community has expressed their concerns around the extension of IR35 to the private sector.
Andy Chamberlain, deputy director of policy at the Association of Independent Professionals and the Self Employed (IPSE) said, “The Government’s new guidance claims that legitimately self-employed people ‘will feel little impact’. Tell this to the thousands of contractors working for Barclays, Lloyds, HSBC and Tesco Bank who have already been told they must move into umbrella companies, go PAYE or cease contracting for these organisations altogether”.
It isn’t just self-employed people who have their concerns though. Businesses looking to source contingent labour are worried too. In a recent survey by Robert Half UK, 62 per cent of the medium and large private sector businesses that were asked about IR35 said they were worried about missing out on skilled contractors after the rollout.
HMRC have recently updated their Check for Employment Status for Tax (CEST) tool, which aims to help understand whether a contractor should be classed as employed or self-employed under IR35. Since it was originally launched in March 2017, the CEST tool has faced heavy criticism for “flawed assessments” and widespread criticism.
IR35 is due to be rolled out to businesses in the private sector from 6th April 2020. Although the main parties have pledged to review off-payroll rules, we’d strongly recommend continuing IR35 preparations.
If you have any concerns around the use of self-employed contractors and the risk of employment tribunals, or your IR35 status as an independent contractor operating through a personal service company, then get in touch.
At the time of writing this article, these were the views expressed by the political parties.