Budget 2015: Chancellor announcement on Employment Intermediaries: Temporary workers

[d000hg]

I think many developers are subject to a fair bit of D&C because we're told what work needs doing... if you're brought in to bolster a dev-team you may well be assigned tasks like everyone else.

But then when you hire a plumber/builder you tell them exactly what work you wish them to do as well.

IR35 is not only about D&C. Being a freelance worker does not make you inside IR35.

[Zero Liability]

Indeed, which is something I think the below article missed:


Budget 2015's block on contractor expenses is fraught with unknowns :: Contractor UK

[jamesbrown]

I think many developers are subject to a fair bit of D&C because we're told what work needs doing... if you're brought in to bolster a dev-team you may well be assigned tasks like everyone else.

But then when you hire a plumber/builder you tell them exactly what work you wish them to do as well.

IR35 is not only about D&C. Being a freelance worker does not make you inside IR35.

Remember that D&C (and hence SD&C) comprises elements of: what, where, when and how. Also remember that there's a big difference between identifying "what" needs to be done at the contract stage versus being directed, or having a change of direction, while the contract is ongoing. There are no problems surrounding the development of a detailed set of requirements as the basis for contract negotiation and acceptance; indeed, this is preferred. However, it would not be acceptable to have a change in direction during the contract (without a renewed negotiation and change in the schedule of work) or to receive instruction on the methods for delivering the specifications or any other elements where there are multiple acceptable pathways to achieving the specifications. The problem with dev work, as in other areas, would be when work is assigned, day-to-day, by a manager or when a manager imposes (or has the right to impose) control over how that work is delivered (beyond pointing to prescribed standards).

[BlasterBates]

Reading that makes it clear to me that a Scrum environment would be the best scenario to put a developer firmly outside of IR35.
I don't see how, by those definitions and examples, I'd be under any S, D&C at all.

Interesting you say that because in the past I was used to being given a relatively large piece of work which took several months and then went live. The situation wasn't exactly scenario one but pretty close. I now work in scrum and there's an awful lot of overlap with scenario 2. You are expected to attend a meeting once a day, where the technical manager is barking out "jim can you pick up that", "Joe can pick up that one", "Fred define a ticket and put it in QA". Once you've written your 3 lines of code it goes into code review where "blocker comments" are put in telling you to change x to y or whatever. The point is the team made up mainly of permies is exerting a great deal of control.

I can see that scrum can be run in a way that you are truly a contractor, but it's still a long way from the old way of leaving a contractor in a corner on his own for 6 months to pop up with the solution having written the code in any way he sees fit.

[jamesbrown]

Interesting you say that because in the past I was used to being given a relatively large piece of work which took several months and then went live. The situation wasn't exactly scenario one but pretty close. I now work in scrum and there's an awful lot of overlap with scenario 2. You are expected to attend a meeting once a day, where the technical manager is barking out "jim can you pick up that", "Joe can pick up that one", "Fred define a ticket and put it in QA". Once you've written your 3 lines of code it goes into code review where "blocker comments" are put in telling you to change x to y or whatever.

I can see that scrum can be run in a way that you are truly a contractor, but it's still a long way from the old way of leaving a contractor in a corner on his own for 6 months to pop up with the solution having written the code in any way he sees fit.

Agreed. From how you've described the process (and I'm not in IT, so I cannot refute it), there would be major problems with this. There would be control in terms of what, when and even how. I would be wary of any situation involving that level of D&C, even if the D&C was indirect (i.e. from other contractors that have been assigned a supervisory role to fulfill by the client), because SD&C is couched in terms of "any person".

[SunnyInHades]

This is HMRC's take on what constitutes SDC https://www.gov.uk/government/upload...g_examples.pdf

They have cited the case law that they feel supports their position

Man, that's a comprehensive document, with scenarios covering 12 different occupations including carpenter !

I've only met a handful of contractors who match 100% free scenario 1.
I've never met contractors who match 100% clobbered micro-managed scenario 2.
I think most contractors I've met sit somewhere between scenario 1 and 2, closer to 1


"IT Consultant.
Paul is a skilled IT Consultant who specialises in designing, building and
implementing websites for businesses. He obtains his work via an employment
business which finds him jobs with clients. A retail clothing company ask the
employment business to provide an IT specialist for a two week engagement, to do
some internet based IT work. The employment business contact Paul and as he
wishes to take the engagement, arrangements are made for Paul to attend an interview
with he client.
Scenario 1.
Paul attends the interview where he meets the company directors who tell Paul they
want him to design, build and place onto the internet, a new website for their business
which will advertise and sell their products online. Discussions are held during which
time Paul shows the directors his portfolio and websites he has previously created.
The directors are impressed and Paul is offered the engagement, which he accepts.
The Directors then tell Paul he has a completely free role to design and build the
website as he sees fit without anyone being able to intervene to instruct Paul what the
website must look like or how it must be created. The only specific requirement
placed on Paul is that the new website is completed, placed on line and activated
before his engagement ends.

At his own choice Paul works alone and decides to do some of the design work at
home and some at the company’s premises, where he is provided with a desk and PC,
but completely left alone to get on with and complete his work. Although the
company have not asked for weekly progress reports, out of courtesy Paul decides to
provide them (as this is how he normally works for his customers). Paul works alone
throughout without any intervention whatsoever from the client and finishes designing
the website on the eleventh day. Paul places the website online on day twelve and
then tells the client he will be monitoring the website’s performance for the remaining
two days of his engagement to make sure it functions correctly. The website works
correctly and on day fourteen Paul’s engagement ends.

In this scenario from the very outset Paul has been told he would be given complete
freedom to decide and control how he would provide his services, without anyone
being able to intervene to dictate what Paul had to do and how he must do it - and this
is what happened in practice. Paul has not been subjected to (or to a right of) any
supervision, direction or control as to the manner in which he provided his services
during his arrangement. The agency legislation does not apply to this scenario.

Scenario 2.
Having been told by the employment business the engagement is for one week
(Monday to Saturday), Paul attends an interview with the Managing Director (MD)
who tells Paul they require an IT specialist for one week (5 days) to assist the
Company’s IT Team with various IT work; which will be arranged and overseen by
the company’s IT Manager. Paul is told the IT Manager will be deciding what jobs
Paul will do, telling Paul how they must be done and throughout he will be
supervising Paul and instructing him as to the order in which the jobs should be done,
which may change at short notice. Paul is informed IT Manager will be managing
Paul and the other IT workers to make sure the work assigned to them is done to the
required specification..

On his first day Paul is based at the company’s trading address. The IT Manager gives
Paul his first job which is to update the company’s website to display new retail
products. The IT Manager gives Paul detailed information on those products, which
includes photographs, descriptions and prices. Paul is then shown how the products
must be displayed on the company’s website. The IT Manager oversees Paul doing
this work, making sure that Paul displays the new products correctly and the
photographs and product descriptions are legible. The IT Manager tells Paul to
shorten some product descriptions and delete discontinued items from the website.
This task takes three days to complete during which time the IT Manager monitors
Paul’s progress throughout to ensure Paul’s work is completed correctly and on time.
On the fourth day Paul accompanies the IT Manager at the company’s Head Office to
help him gather figures on product sales over the last 6 months. Paul is told to access
the company’s database where he is to extract the figures for all product sales and list
them on a specific spreadsheet provided in order of what products have sold the most.
The IT Manager watches Paul compile the data to ensure it is done correctly and then
checks Paul’s completed spreadsheet for accuracy. This work takes Paul two days
after which his contract to work for this client has been completed.
In this scenario the Company have made it clear to Paul the IT Manager would have a
right to give Paul directions and supervision as to how he must do his work. In
addition the IT Manager would have the right to control how Paul did his work by
dictating how it must be done. From the very outset of this arrangement Paul has been
subject to a right of supervision, direction or control as to the manner in which he did
his work and even if that “right” not been implemented in practice (which in this case
it was) the existence of that right of supervision direction or control as to the manner
in which Paul provided his services is sufficient for the agency legislation to apply to
this scenario, provided the other conditions of the legislation are also met.
"

[SpontaneousOrder]

Interesting you say that because in the past I was used to being given a relatively large piece of work which took several months and then went live. The situation wasn't exactly scenario one but pretty close. I now work in scrum and there's an awful lot of overlap with scenario 2. You are expected to attend a meeting once a day, where the technical manager is barking out "jim can you pick up that", "Joe can pick up that one", "Fred define a ticket and put it in QA". Once you've written your 3 lines of code it goes into code review where "blocker comments" are put in telling you to change x to y or whatever. The point is the team made up mainly of permies is exerting a great deal of control.

I can see that scrum can be run in a way that you are truly a contractor, but it's still a long way from the old way of leaving a contractor in a corner on his own for 6 months to pop up with the solution having written the code in any way he sees fit.

That doesn't sound very much like Scrum to me. It just sounds like people using a Scrum vocabulary and therefore saying that they are doing Scrum. In your example it would definitely lean more towards scenario 2.

That's the worrying bit, though. One has to try to discern during the interview stage whether the client is actually doing Scrum or just thinks that they are :s

It's a bit like "Yeah, we do continuous integration, etc, etc", and when you turn up you find out that they only integrate feature branches every 3 months or so - and what they really meant by "we do CI" was "we have a jenkins box". Except naivety in engineering practises doesn't get you clobbered by the tax man.

[jamesbrown]

Man, that's a comprehensive document, with scenarios covering 12 different occupations including carpenter !

I've only met a handful of contractors who match 100% free scenario 1.
I've never met contractors who match 100% clobbered micro-managed scenario 2.
I think most contractors I've met sit somewhere between scenario 1 and 2, closer to 1

Welcome to HMRC guidance. You'll never get, and should never expect, clarity on anything related to employment status, at least that covers a significant fraction of those potentially affected, because they are trying to minimize Exchequer risk with limited resources (ergo, fuzz is good).

[SpontaneousOrder]

Interesting you say that because in the past I was used to being given a relatively large piece of work which took several months and then went live. The situation wasn't exactly scenario one but pretty close. I now work in scrum and there's an awful lot of overlap with scenario 2. You are expected to attend a meeting once a day, where the technical manager is barking out "jim can you pick up that", "Joe can pick up that one", "Fred define a ticket and put it in QA". Once you've written your 3 lines of code it goes into code review where "blocker comments" are put in telling you to change x to y or whatever. The point is the team made up mainly of permies is exerting a great deal of control.

I can see that scrum can be run in a way that you are truly a contractor, but it's still a long way from the old way of leaving a contractor in a corner on his own for 6 months to pop up with the solution having written the code in any way he sees fit.

E.g, there is no such thing as a tech manager. The only manager in a Scrum team is the ScrumMaster - and he/she doesn't manage the Scrum team. There is no manager.

Then the only person to answer to is the PO, and they arent' a manager either (of the Scrum team). You answer to them in the same way a plumber answers to the customer he's doing pipework for.

[SueEllen]

I now work in scrum and there's an awful lot of overlap with scenario 2. You are expected to attend a meeting once a day, where the technical manager is barking out "jim can you pick up that", "Joe can pick up that one", "Fred define a ticket and put it in QA". Once you've written your 3 lines of code it goes into code review where "blocker comments" are put in telling you to change x to y or whatever. The point is the team made up mainly of permies is exerting a great deal of control.

I can see that scrum can be run in a way that you are truly a contractor, but it's still a long way from the old way of leaving a contractor in a corner on his own for 6 months to pop up with the solution having written the code in any way he sees fit.

How your Scrum is being run is not how it should be done.

You (and every individual in the team) should know what is on the backlog, assign stories to yourself and tell everyone in the daily scrum what you are doing.