For a friend - Been forced Permie to Contractor

[Tomo1971]

Are they being forced to go contracting to get their jobs back or is their role gone but the agent can place them as knowledge of the client is useful? My last client had a habit of making people redundant only for them to appear again contracting 3 months later after a cool down period.

As far as I am aware, the former. The company involved (quite a large household name as it happens, or at least a small division of them) has work coming up with one of its clients, so absolutely so reason to make the positions redundant. Ive heard from someone else that one of the reasons for the change is that the PAYE guys were, due to a very weird pay structure been paid more hours than they actually worked and this equated to £80k for some guys. As a contractor, with no van, fuel, accommodation, pension etc supplied they stand to save some money.

And why can't your friends pot for themselves? It's their risk after all.

I originally posted as I wasn't fully sure of the implications, so wanted some ball park advice before advising him that what they are doing is wrong in HMRC's eyes as well as morally.

Ive made him aware of this thread and obviously the advice already given, up to him if he wants to take things further.

Thanks :-)