3 months outside and then inside - Red Flag?

[MagicMovies]

Hello!

Just been approached for a role at a major company. The pay is good, 2-3 days WFH available etc., but one major red flag (imo) is that the recruitment agency told that the role is outside IR35 but when I spoke with the team, they said it is inside IR35. Now, when I followed up this with the recruitment agency, they said "Well, it is originally inside IR35 but now that the reforms have been pushed back, it is outside IR35 through the use of limited company for 3 months and then it would be inside IR35 after 3 months".

The whole thing sounds murky because if they decide after 3 months it is inside IR35 (which in all likelihood they will!), then the role has been inside IR35 all along - isn't it?

[eek]

Hello!

Just been approached for a role at a major company. The pay is good, 2-3 days WFH available etc., but one major red flag (imo) is that the recruitment agency told that the role is outside IR35 but when I spoke with the team, they said it is inside IR35. Now, when I followed up this with the recruitment agency, they said "Well, it is originally inside IR35 but now that the reforms have been pushed back, it is outside IR35 through the use of limited company for 3 months and then it would be inside IR35 after 3 months".

The whole thing sounds murky because if they decide after 3 months it is inside IR35 (which in all likelihood they will!), then the role has been inside IR35 all along - isn't it?

Yep - if the end client is saying it's inside IR35 then I really wouldn't trying to argue that it's outside.

[northernladuk]

These situations are complicated. If the client says inside then that should be filtered down the chain so the right determination can be made by you. It's not for them to determine now so you could assess it on it's merits and quite possible come with an outside determination. The problem is WHY do they say inside. If that role was individually assessed using a proper method and it's inside then it would be very risky to ignore that and go outside. It's just going to open a massive can of worms if you get investigated or when they go back to inside in a years time.

If the role was blanket assessed then you are probably OK. You'll have to make a proper determination on the facts presented and get on with it. A blanket assessment won't have had proper diligence on it so won't stand up. Still not without it's risks as the client will obviously try and shaft you in an investigation.

That said, if they blanketed it because of some overarching policy like they will not allow subs or they expect their contractors to be under D&C then you determining yourself outside is risky and bordering on incorrect.

It's a sticky situation. Was it a true determination from the client and done properly or a daft blanket approach? You'll have to try find out why they think it's inside. There will be one of two answers... Because we don't allow xxxx and yyyy (bad for you) or because they said they blanketed it (good for you(ish))

That help at all?

[MagicMovies]

These situations are complicated. If the client says inside then that should be filtered down the chain so the right determination can be made by you. It's not for them to determine now so you could assess it on it's merits and quite possible come with an outside determination. The problem is WHY do they say inside. If that role was individually assessed using a proper method and it's inside then it would be very risky to ignore that and go outside. It's just going to open a massive can of worms if you get investigated or when they go back to inside in a years time.

If the role was blanket assessed then you are probably OK. You'll have to make a proper determination on the facts presented and get on with it. A blanket assessment won't have had proper diligence on it so won't stand up. Still not without it's risks as the client will obviously try and shaft you in an investigation.

That said, if they blanketed it because of some overarching policy like they will not allow subs or they expect their contractors to be under D&C then you determining yourself outside is risky and bordering on incorrect.

It's a sticky situation. Was it a true determination from the client and done properly or a daft blanket approach? You'll have to try find out why they think it's inside. There will be one of two answers... Because we don't allow xxxx and yyyy (bad for you) or because they said they blanketed it (good for you(ish))

That help at all?

@northernladuk: Thanks for the detailed write up. I will ask them but from the initial discussion, I think they just went with a blanket inside but I will confirm that and then decide accordingly.

[northernladuk]

@northernladuk: Thanks for the detailed write up. I will ask them but from the initial discussion, I think they just went with a blanket inside but I will confirm that and then decide accordingly.

It might be worth asking if they will do a Confirmation of Arrangements letter to make absolutely sure nothing falls through the cracks.

Your contract might say substitution is allowed but we've already seen a number of times in the last few months the lower level contracts have absolutely no bearing on the client reality so a real problem. By getting a CoA you are confirming that they agree with the terms in your contract. If they do not intend to honour subs at least you'll find out and dodge that bullet even if it's bad news.

It's discussed here and there is a template for you.
Confirmation of Arrangements - IR35 Resources - Qdos Contractor

Many people in the past have ignored whatever the client wants and stick to their contract and argue it out if ever gets to court. They can claim it's in there even though it wasn't exercised. I think that is a really bad move at present as it won't go away and will fail when scrutiny is applied. Clients will have thought about this so just to go in with that flimsy argument when the client can demonstrate they never intended to allow it is not going to end well.

You might get bad news with the CoA but at least you know.