"We must opt you out of the Conduct of Employment Agencies Regs 2003...

[Wanderer]

I'll report back what EAS they tells me in response to my FOI enquiry above. In the meantime, I'd encourage any contractor with an interest in making Employment Businesses stick to the letter of the law that protects workers of all kinds to write to the EAS with the exact same FOI enquiry.

I think it's also time that PCG members raised this with the PCG too as it was them who negotiated the opt out. I know the PCG meant well and I respect the work they do, but it's an incredibly poorly drafted clause which leaves the whole thing as a grey area. Of course no agency will ever let this get tested in court because they would be happy to leave it ambiguous so they can stick with their standard procedure of bluff and bluster.

Abuse of the opt out which is clearly rife based on the number of people who ask about it on this forum and the amount of bullying that agencies do to get people to agree to sign their rights away.

The PCG's original intention was to protect contractors who subcontract work but that turned out to be a huge own goal as the vast majority of contractors would not be caught by the Agency Conduct Regulations as they are not acting as an "Employment Agency" or an "Employment Business" as defined in law. Any contractor who was acting on this basis would be well aware of the fact as there is a whole raft of other agency legislation they would have to comply with.

[Gentile]

I think it's also time that PCG members raised this with the PCG too as it was them who negotiated the opt out. I know the PCG meant well and I respect the work they do, but it's an incredibly poorly drafted clause which leaves the whole thing as a grey area. Of course no agency will ever let this get tested in court because they would be happy to leave it ambiguous so they can stick with their standard procedure of bluff and bluster.

Abuse of the opt out which is clearly rife based on the number of people who ask about it on this forum and the amount of bullying that agencies do to get people to agree to sign their rights away.

The PCG's original intention was to protect contractors who subcontract work but that turned out to be a huge own goal as the vast majority of contractors would not be caught by the Agency Conduct Regulations as they are not acting as an "Employment Agency" or an "Employment Business" as defined in law. Any contractor who was acting on this basis would be well aware of the fact as there is a whole raft of other agency legislation they would have to comply with.

The thing is, I don't think the ability to opt out even is a grey area. Nor is it any kind of protection against falling inside IR35, as PCG undoubtedly intended it to be.

Even if you were prepared to accept for a moment that by not having the statutory rights encapsulated in the Regulations that would somehow place you outside IR35 on its own, the PCG seem to have forgotten that voluntarily signing away those rights would render the matter null and void.

If you've ever had to claim any kind of Council Tax or Unemployment benefit, a state pension, or tax relief of any kind, you'll be aware that such claims are means tested. Not only do they ask you what your savings are and your relationship status in relevant cases, but they also want to know about any aspect of your situation that has arisen purely because you voluntarily took certain actions.

e.g., if you have savings of £100k, and you opt to 'give' those savings away to a trusted friend or one of your children right before you claim council tax benefit just so that you can honestly say you have no money, that will be taken into consideration in determining your real status and you'll be treated as if you had not freely given away your money for the purposes of being awarded benefit. If you're claiming to be single, and you've recently split up with someone purely for convenience so that you may claim a certain tax relief, you'll similarly be treated as if you were in a relationship for the purposes of your claim.

So, if you opt, voluntarily, freely to make yourself less advantaged as an individual worker than the law provides for you to be, does anyone really think that will wash in terms of proving anything at all about your IR35 status? All it'd prove would be that you were gullible enough a businessperson to voluntarily sign away your statutory rights. It wouldn't prove a thing about your employment status, because it's something you freely entered into when you didn't have to. To be taken into consideration, your status would have to have come about as a result of factors that were truly outside your control. Not to mention a lot of the restrictions noted in the Regulations 2003 make plain good business sense.

[Taita]

Timesheets. Apparently the real problem is now those damnable timesheets. If they don't get filled in, the agency doesn't get paid, you see? They've never had a contractor not opt out in all their time as an agent. Please opt out.

My answer: "Yes, that's right. I still get paid, even if the Client doesn't sign a timesheet. I can assure you that I will fill in my timesheets in a timely fashion, as I've agreed to in my contract. If, however, you're still concerned that the Client may delay in signing off on them, I'd advise you to include a clause in the Upper Contract you have with them that clearly states you will still be entitled to invoice in the case of a timesheet not being signed for work that is nonetheless agreed to have been carried out as per the agency regs blah blah. In a contract where there is a stipulation that I must invoice and provide a timesheet every 7 days, hopefully you'll see that there's not much if any risk inherent in this approach, and that it'll be very easy to spot any problems with the Client withholding timesheet approval at an early stage and to address that appropriately."

I also mentioned that I could see from their LinkedIn profile that they've only been in the job six months. I've been a contractor for nearly thirteen years. So, whilst I'm not surprised they've not had anyone decline to opt out since there are a lot of new contractors out there that allow themselves to be bullied into signing their statutory rights away, I'm not in that category. And I've no doubt they'll be seeing a lot more people like me over the next twelve years if they stick around.

Maddening! The agency has been around for a few years and seems sound enough. If the consultant is inexperienced is it not worth asking to speak to a more senior person/director? Insistence on the opt-out is probably routine because they get away with it but, as you have said, they are in breach of specific legal requirements. A director is bound to take your complaint more seriously......one hopes! If not, I would think twice about working through them.

[a3254643]

My experience, armed with the info on this thread. I'm just about to start my 1st contract.

The contract contains a clause to the effect that I have opted out of Conduct of Employment Agencies and Employment Businesses Regulations 2003. The rest of the contract is IR35 friendly, and has passed the QDOS review. The last page of the contract also contains the opt out statement for me to sign. Contractual payment terms are 14 days invoicing with payment 14 days later.

Conversation with the agent goes something like this.

Me: I'm opting into the 2003 regs.
Agent: You're the 1st contractor who has done this, it'll put you inside IR35, we need to give you a different contract, and you'll have to use an umbrella company not Ltd.
Me: The advice I've had is that it has no effect on IR35, the contract is fine as it is, and I don't have to use an Umbrella.
Agent: I'll check with Legal.

Next Day
Agent: Why do you want to opt in?
Me: It gives my Ltd more protection against the client not paying.
Agent: The actual process is 7 days invoicing with payment 7 days later. The contractual terms of 14 days shows increased business risk which helps with IR35
Me: It is my choice to opt in or out so I'm opting in.
Agent: You're the 1st contractor who has done this, it'll put you inside IR35, we need to give you a different contract, and you'll have to use an umbrella company not Ltd.
Me: Can I have that in writing?
Agent: I'll check with legal.

2 Days Later
Agent: You're the 1st contractor who has done this, it'll put you inside IR35, we need to give you a different contract, and you'll have to use an umbrella company not Ltd.
Me: Can I have that in writing?
Agent: No, we don't deal with contractors who opt in, so if you want to opt in, we'll have to pass you to an intermediary agency to deal with and explain the delay to the client.
Me: I'll sign the opt in, on the basis of 7 day invoicing and 7 day payment.

So I blinked 1st, the agency won, but in my defence this is my 1st contract, and the client is public sector so hopefully less risk of not paying. I don't think there is any possibility of going direct, so that isn't a concern either. Fingers crossed.

[a3254643]

Oh, and I've also already met the client at the interview. The agent didn't really respond to this point on "introduction" to the client.

[escapeUK]

Why is Gentile showing as banned? I read through her last few posts and there was no clue there.

Edit: A search via google is showing some threads re Gentile Banning, so I will work through those.

[malvolio]

Let's have a degree of realism, chaps, please.

Firslty the opt out or in is absolutely nothing to do with IR35 and never has been.

Secondly the legislation is specific; the opt out is totally at the discretion of the worker and their company, both of whom have to agree to it. Nobody can make you do it or coerce you to do so.

Thirdly it cannot be made a condition of the contract, although obviously the agency can choose who they want to do business with - as can you and any other company - and if they only want to deal with opted out people that's their right.

Fourthly the definiton of "Introduction" is the problem. It may mean "when the client knows who you are" in the sense we understand it or it may mean "when the previously unidentified worker turns up on the Monday" as per the Office Angels model which the agencies prefer. Until it goes to court, we will never know and neither side can be rigid about it.

Finally it affects various clauses ion your contract and the amount of work (and therefore risk) the agency has to do; if you opt out you save the agency time, money and risk, all of which are things dear to their hearts.

However signing a clause in the contract saying you've opted out is totally meaningless, you have to have done it before the contract is issued and you are by default opted in (which rather scrambles your contract, of course) . But as I say, until someone deemed to have opted out goes to court to claim something they are entitled to from being opted in, we will never find out the actual reality. Any volunteers?

[TykeMerc]

Let's have a degree of realism, chaps, please.

Firstly the opt out or in is absolutely nothing to do with IR35 and never has been.

Secondly the legislation is specific; the opt out is totally at the discretion of the worker and their company, both of whom have to agree to it. Nobody can make you do it or coerce you to do so.

Absolutely true, however despite it being completely true it doesn't stop agencies routinely stating it's not, attempting bullying tactics or simply withdrawing contract offers which is pretty damn effective coercion whichever way you paint it.

Thirdly it cannot be made a condition of the contract, although obviously the agency can choose who they want to do business with - as can you and any other company - and if they only want to deal with opted out people that's their right.

Which in effect amounts to it being made a condition of the contract. If you take a hard line on the issue then there's nothing to prevent the agent telling the client you've declined the contract.

Fourthly the definiton of "Introduction" is the problem. It may mean "when the client knows who you are" in the sense we understand it or it may mean "when the previously unidentified worker turns up on the Monday" as per the Office Angels model which the agencies prefer. Until it goes to court, we will never know and neither side can be rigid about it.

Shame the sainted PCG dropped the ball so badly on that particular bit when they got the whole farce introduced in the first place.

Finally it affects various clauses in your contract and the amount of work (and therefore risk) the agency has to do; if you opt out you save the agency time, money and risk, all of which are things dear to their hearts.

Why the PCG didn't even contemplate this when they negotiated this into the regs we will never know, but I do hope the individuals responsible feel thoroughly guilty.

However signing a clause in the contract saying you've opted out is totally meaningless, you have to have done it before the contract is issued and you are by default opted in (which rather scrambles your contract, of course) . But as I say, until someone deemed to have opted out goes to court to claim something they are entitled to from being opted in, we will never find out the actual reality. Any volunteers?

This is, of course, true however until it's tested in court which is exceptionally unlikely the misinformation and misconceptions will continue. If only the PCG hadn't introduced the damn thing in the first place we would all be better off.

I realise that this looks like an anti PCG rant and to an extent it is as it's entirely their responsibility that the Opt Out (and associated consequences) exist.
Let's face it in the vast majority of cases Opting Out is a bad idea for the contractor and an excuse to take the mickey for the agencies.

[malvolio]

Absolutely true, however despite it being completely true it doesn't stop agencies routinely stating it's not, attempting bullying tactics or simply withdrawing contract offers which is pretty damn effective coercion whichever way you paint it.



Which in effect amounts to it being made a condition of the contract. If you take a hard line on the issue then there's nothing to prevent the agent telling the client you've declined the contract.



Shame the sainted PCG dropped the ball so badly on that particular bit when they got the whole farce introduced in the first place.



Why the PCG didn't even contemplate this when they negotiated this into the regs we will never know, but I do hope the individuals responsible feel thoroughly guilty.



This is, of course, true however until it's tested in court which is exceptionally unlikely the misinformation and misconceptions will continue. If only the PCG hadn't introduced the damn thing in the first place we would all be better off.

I realise that this looks like an anti PCG rant and to an extent it is as it's entirely their responsibility that the Opt Out (and associated consequences) exist.
Let's face it in the vast majority of cases Opting Out is a bad idea for the contractor and an excuse to take the mickey for the agencies.

I disagree with almost all of that, but hey, if it makes you happy...

But stop blanming the PCG. Like the AWR and the 24 month rule, the problem is HMG failing to recognise our existence and writing regulations intended to protect vulenerable temporary staff in such a way that any non-employee is in scope. A little bit of thought on the side of the useless civil servants who draft this rubbish would have avoided the whole debacle.

Adn the PCG's aim with teh Opt Out was to get all Ltd Co one man bands out of scope. ANd then HMG once again f***ed up.

So save the bile for the cporect target: the inept Civil Service and the Agencies taking advantage to save themselves some cash.

[Antman]

Let's have a degree of realism, chaps, please.

Firslty the opt out or in is absolutely nothing to do with IR35 and never has been.

Secondly the legislation is specific; the opt out is totally at the discretion of the worker and their company, both of whom have to agree to it. Nobody can make you do it or coerce you to do so.

Thirdly it cannot be made a condition of the contract, although obviously the agency can choose who they want to do business with - as can you and any other company - and if they only want to deal with opted out people that's their right.

Fourthly the definiton of "Introduction" is the problem. It may mean "when the client knows who you are" in the sense we understand it or it may mean "when the previously unidentified worker turns up on the Monday" as per the Office Angels model which the agencies prefer. Until it goes to court, we will never know and neither side can be rigid about it.

Finally it affects various clauses ion your contract and the amount of work (and therefore risk) the agency has to do; if you opt out you save the agency time, money and risk, all of which are things dear to their hearts.

However signing a clause in the contract saying you've opted out is totally meaningless, you have to have done it before the contract is issued and you are by default opted in (which rather scrambles your contract, of course) . But as I say, until someone deemed to have opted out goes to court to claim something they are entitled to from being opted in, we will never find out the actual reality. Any volunteers?

And this is the point as I see it, my perception is that the AWR are badly drawn up. Would they stand up to scrutiny in court? Enough for you rest a case on? Well I'm not a betting man, so I won't be volunteering. However to mitigate this I'd be making a business decision about whether you want to form a relationship with the agency/end-client in the first place (the credit-checking tool that somebody mentioned a few weeks ago), negotiating payment terms so you're not too exposed financially then relying on some legislature designed for a completely different class of worker.

As (IT) contractors this is the world we live in, just another ball-ache that permies don't have to deal with.