First job, first contract, a bit confused...

**Clare@InTouch** · 31 January 2013, 14:40

It sounds like they've given you a Limited Company contract - just go back and ask them for an Umbrella contract if that's what you want. And appoint an Umbrella company

If you're contracting for a while and you'll be earning over £30k then you may want to think about a Limited Company, in which case I'd suggest you give a few accountants a call to talk through the options. They could help with a contract review too in some cases.

**Taurig** · 31 January 2013, 15:20

Hi Clare, thanks for your reply. I have just been reading more about umbrella companies etc. and I think that would be most convenient for me. I really had no intention of setting up a company just to work for another company! I assume the agency will have an umbrella company in mind, would it be best to go with them or shop around?

I've also been reading more about the conduct regulations, and have realised that as per Regulation 15, this contract they have given me does not mention anything about holiday allowance, sick pay, anything of the sort. Would this usually be covered by the contract with the agency/umbrella company or in a separate contract with the client?

The more I read into this, the less happy I am. I was excited to start work as well!

**northernladuk** · 31 January 2013, 15:32

[QUOTE=Taurig;1692172]Hi, first post on here after receiving my first job contract this morning!

I'll try to give a bit of background whilst remaining anonymous. I've recently completed a science PhD. A fortnight ago I had a successful interview with a large manufacturing company for a one year fixed term contract, and am due to start work in a matter of days. I applied for the position through an agency, who I am now starting to realise I should have asked more questions of. [quote]

Interesting. We had a discussion on these awful FTC's and I, and probably others, were of the opinion that these were offered by the client via HR and was a permie contract but with an end date rather than a contractor type contract. It normally includes holidays and other perks permie gets. Interest to see that they are offering FTC's to LTDs. Maybe I am reading this wrong and you are mixing FTC up with a contract of a certain duration which all ours are. Dunno

The agency have only sent me the contract this morning, leaving me very little time to get to grips with contract work. The guy asked me to sign pages X and Y, page X being the opt out for Conduct Regulations 2003. Had I not looked into this on this forum I probably would have signed without thinking; now, I am going to tell them I won't sign and can they please amend the main body of the contract to reflect this, particularly regarding the section about moving to permanent employment with the Client (They had me by the balls for a year after this current contract basically).

Good luck with that because you are going to get in to a fight that you need to understand to see through. If you don't know what you are doing they will beat you to a pulp with your lack of knowledge. Sign it and concentrate on other stuff.

Interesting this goes from FTC to perm again.. this is normally done via HR as already mentioned. If this is the case it doesn't matter if it is in the contract. If that is the clients intention then it sticks if it is in the contract or not. This would mean your contract is inside IR35. There are some benefits of having your own LTD when inside IR35 but looking at your panic here the slight benefits are not going to be worth the stress. Stay Brollie.

This is the bit that is confusing me now: I am apparently a 'Service Provider' with a 'TBC' company registered in England and Wales but with a main office at my home address in Scotland. I am also the 'Consultant' who is provided by the Service Provider to do the work for the company. Apparently, they cannot pay me until I provide them with a Certificate of Incorporation for my company. What the eff? I was told that an umbrella company would deal with my taxes, NI etc. and I assumed that I could just give them my personal bank details and that would be job done. Now I'm wondering if I have to set up a business account and register a company! Perhaps the former is the case and it'll work out easier than I expected, but I now distrust this employment agency and wanted to get some impartial advice before contacting them again.

Any advice much appreciated.

Forget starting a LTD due to IR35 and stay brollie. Ring the agent again and make this clear to them quickly. They might drop a preferred supplier on the list that will catch you on the hop.

Let's be clear here. This is contract leading to employment. It isn't a contract that we would generally be used to on this forum.

**northernladuk** · 31 January 2013, 15:33

Originally posted by Clare@InTouch View Post

It sounds like they've given you a Limited Company contract - just go back and ask them for an Umbrella contract if that's what you want. And appoint an Umbrella company

If you're contracting for a while and you'll be earning over £30k then you may want to think about a Limited Company, in which case I'd suggest you give a few accountants a call to talk through the options. They could help with a contract review too in some cases.

Unless you are clearly within IR35 which the contract to employment expectation would suggest.

I said FTC's are a disgrace and this is even worse. Contractor type FTC to perm employment. Utterly ridiculous.

**malvolio** · 31 January 2013, 15:39

Originally posted by northernladuk View Post

Unless you are clearly within IR35 which the contract to employment expectation would suggest.

I said FTC's are a disgrace and this is even worse. Contractor type FTC to perm employment. Utterly ridiculous.

I think it's called a "Trial Period"...

As far as the agency is concerned, they shouldn't have sent any kind of a contract at all if this is a proper FTC, in which case it is a full-blooded contract of employment with the end company jus liek any other permy's.

**northernladuk** · 31 January 2013, 15:48

Originally posted by malvolio View Post

I think it's called a "Trial Period"...

As far as the agency is concerned, they shouldn't have sent any kind of a contract at all if this is a proper FTC, in which case it is a full-blooded contract of employment with the end company jus liek any other permy's.

Now THAT would make sense.

**Taurig** · 31 January 2013, 16:48

OK, just off the phone with the agency guy. Apparently I am on a daily rate contract; I work the day, I get paid, I don't work, I don't get paid. They have sent me a Ltd Company contract 'for now' so I can start work on Monday, but then I'll get switched over to an umbrella company shortly after with a new contract under the umbrella company that I re-sign.

So, according to the agency guy, I cannot have a daily rate contract AND opt in. Apparently opting in means you are signing up for PAYE etc., and the this is not compatible with daily rate contract. What are peoples thoughts on this? Is it basically sign the thing or leave the job?

**TheFaQQer** · 31 January 2013, 16:57

Originally posted by Taurig View Post

So, according to the agency guy, I cannot have a daily rate contract AND opt in. Apparently opting in means you are signing up for PAYE etc., and the this is not compatible with daily rate contract. What are peoples thoughts on this? Is it basically sign the thing or leave the job?

He's talking crap. If you want to remain opted in, then remain opted in. If you want to opt out, then opt out. Be prepared to argue this with the agent, though.

Opting in has absolutely nothing to do with PAYE - I've never opted out and have always been on a daily rate.

From what you describe, though, you may be best off going through PAYE anyway. Since you have no intention to continue as a freelancer, then the expenses which you could claim are limited as this "contract" becomes your permanent place of work until you leave.

If you are really concerned about opting out, then go umbrella - the agency would need to have the umbrella and you opt out separately, which isn't going to happen before you start work for the client on Monday.

**deanosity** · 31 January 2013, 16:58

Originally posted by Taurig View Post

OK, just off the phone with the agency guy. Apparently I am on a daily rate contract; I work the day, I get paid, I don't work, I don't get paid. They have sent me a Ltd Company contract 'for now' so I can start work on Monday, but then I'll get switched over to an umbrella company shortly after with a new contract under the umbrella company that I re-sign.

So, according to the agency guy, I cannot have a daily rate contract AND opt in. Apparently opting in means you are signing up for PAYE etc., and the this is not compatible with daily rate contract. What are peoples thoughts on this? Is it basically sign the thing or leave the job?

I don't see how you can sign a contract for a limited company when you don't have one.

I'm sure you could get a umbrella sorted out in the next few days.

He is wrong.

First job, first contract, a bit confused...