Opt out of Conduct of employment agencies 2003 act? - IR35 caught contract

**eek** · 12 July 2021, 15:33

Originally posted by alexmc View Post

So I have been asked to opt out of Conduct of employment agencies 2003 act, for an IR35 caught contract. This is before I have been introduced to the client *for this role*.

I have read a fair bit (including a thread here from 2015) but I am confused as to how things may have changed with the recent IR35 changes.

Here are my assumptions/understandings so far

a) The opt out has to be done before introduction to client.
b) When doing a non IR35 caught contract my company does not want me to look like an employee of the client so I am happy to opt out of anything that looks like employee rights or 'agency worker rights'. The agreement is in the contract.
c) When doing IR35 caught work through an umbrella my company probably wont have anything to do with the contract. I will be acting as an individual and will want all the rights due to a temporary employee. I can't see any benefit to opting out.

So in summary, when doing contract work B2B in a non IR35 caught way, I am happy to opt out.
When doing temporary work under an IR35 caught contract I don't want to opt out.

Have I missed anything?

Yes, it's why Agencies love Umbrella companies as the existence of a external 3rd party (the umbrella company) allows them to keep the money rolling in as it allows them to completely abuse the opt out rules....

**ladymuck** · 12 July 2021, 15:41

The Agency Regs really don't (shouldn't?) have any bearing on IR35 although the wording and the attitude of some agencies may suggest otherwise.

The main benefit for a contractor to opt in is to be paid even though the agency hasn't been paid. This is useful when there's a dispute - you've done the work but the client is being an arse about payment. However, there is a lot of other stuff included in the regs that an outside IR35 contractor would find unpalatable.

I personally would take the approach you have. You need to be 100% sure that all terms relating to the contract are agreed BEFORE you are introduced to the client. This part is generally missed by agencies which then automatically leads to an opted out status.

Crunch has a nice summary of the key points, if you've not seen that one already:
https://www.crunch.co.uk/knowledge/e...ulations-2003/

**eek** · 12 July 2021, 15:46

Originally posted by ladymuck View Post

The Agency Regs really don't (shouldn't?) have any bearing on IR35 although the wording and the attitude of some agencies may suggest otherwise.

The main benefit for a contractor to opt in is to be paid even though the agency hasn't been paid. This is useful when there's a dispute - you've done the work but the client is being an arse about payment. However, there is a lot of other stuff included in the regs that an outside IR35 contractor would find unpalatable.

I personally would take the approach you have. You need to be 100% sure that all terms relating to the contract are agreed BEFORE you are introduced to the client. This part is generally missed by agencies which then automatically leads to an opted out status.

Crunch has a nice summary of the key points, if you've not seen that one already:
https://www.crunch.co.uk/knowledge/e...ulations-2003/

You are aware that a lot of umbrellas will have opt-outs included within their standard T&Cs

It's an area FCSA won't go anywhere near because it would upset the member's customers (i.e. the agencies the umbrellas pay £x0,000 kickbacks to) too much.

**ladymuck** · 12 July 2021, 15:53

Originally posted by eek View Post

You are aware that a lot of umbrellas will have opt-outs included within their standard T&Cs

It's an area FCSA won't go anywhere near because it would upset the member's customers (i.e. the agencies the umbrellas pay £x0,000 kickbacks to) too much.

I didn't know that. Bloody cheeky of an umbrella to force an opt out when it would be to the contractor's benefit to be opted in.

**alexmc** · 12 July 2021, 17:00

Originally posted by eek View Post

You are aware that a lot of umbrellas will have opt-outs included within their standard T&Cs

No, that is something I was not aware of. Ridiculous.

**northernladuk** · 13 July 2021, 10:00

Originally posted by alexmc View Post

No, that is something I was not aware of. Ridiculous.

You should if you read the T&C's carefully. It's there in black and white after all... but many people don't understand the act and even less agents/umbrellas so it wouldn't be surprising if it's not very clear in there.

Make sure you read AND UNDERSTAND all elements of a contract and the T&C's. Don't leave anything to chance and ask the brollies to explain everything you've got questions about. Payslips often cause confusion so stay on the phone to the umbrella until they've given you an explanation you are happy with.

**northernladuk** · 13 July 2021, 10:02

Originally posted by ladymuck View Post

I didn't know that. Bloody cheeky of an umbrella to force an opt out when it would be to the contractor's benefit to be opted in.

Agents do it all the time. Many agents will only deal with Opt out contractors. There was an argument about this being discrimination. SueEllen and Cojak both asked BiS about this and got differing answers. IMO it's a business decision to only deal with certain situation, just like some insurance companies favour older drivers etc.

**ComplianceLady** · 14 July 2021, 09:10

Interested in what protections you think the EAA provides for contractors?

**eek** · 14 July 2021, 09:20

Originally posted by ComplianceLady View Post

Interested in what protections you think the EAA provides for contractors?

Go and read the act and see what it says for agency workers as I'm not going to educate someone who claims to do what you do for a living.

When you've done that look at the opt outs and see why agencies like them to keep the money rolling in.

Opt out of Conduct of employment agencies 2003 act? - IR35 caught contract