Enforced Days Off - IR35 impact?

[monkeyrhythm]

Every Christmas the client I work for enforces a contractor furlough whereby the contractors are informed their services are no longer required over the holiday period (usually about 10 working days including the 3 bank holidays). They've also just announced that contractors must take 5 days 'off' between now and the start of the financial year.

What do people feel the IR35 impact would be (if any?)? For example does this go some way to showing there's no Mutuality of Obligation? Conversely could it be interpreted this makes the relationship more employment like?

What do you guys think?

[Craig@Clarity]

If its a policy for all workers e.g. a factory shut down, then I can't see this impacting on IR35.

Equally, if for some reason there was a hardware failure on site and you were sent home but permie's had to remain on site you could also argue lack of MOO. A recent case was published here Freelancer Wins Seven Year Battle With HMRC In Significant IR35 Ruling | PCG (PCG)

[TykeMerc]

I see the 5 days off prior to financial year end as an IR35 positive too. Employees can't really be asked to sacrifice 5 days income to save cost, but it's reasonable in a business to business arrangement.

[northernladuk]

You could argue the case that you are a contractor, you get paid for the days work you do. Customer site is closed, you are willing to work but unable due to client side commitments so won't be billing. 'Techinically' this not enforced days off, just unable to complete a days work you are available to do.

Might sound like a daft way of putting the same situation it but is different to the term 'enforced day off' which (I guess) will make all the difference to an IR35 investigation.

[monkeyrhythm]

To clarify it's solely a contractor policy. Over Christmas permies are subject to their standard holiday entitlement, if they don't book the time off they work (aside from the 3 bank holidays). The latest directive is again specifically contractor focused, the 5 days are of the contractors choosing, they just need to be between now and the start of April.

It's purely a cost cutting exercise; Christmas is generally quiet hence the xmas policy and I guess they feel contractors take less time off than their permie counterparts when in contract and the projects they're working on can (generally) absorb a little time off.

[monkeyrhythm]

My thoughts were inline with TykeMerc's - it feels more like a B to B type arrangement to me, hence the question of IR35 impact.

[Danielsjdaccountancy]

Provided you aren't being paid Holiday pay then I can't see an issue. As mentioned it could help set you apart from the other employees.