Opt out of Conduct of employment agencies 2003 act?

[Wanderer]

I rolled over and signed. I thought all the comments were great when but when it came to the reality it was just useless.

My advice would be try to stay opt in, if the agency steadfastly refuse to do it then opt out and don't lose any sleep over it.

I pragmatic approach, I do agree. The agencies are winning. I'm just waiting to pick a fight with one the next time an opportunity comes up...

if you want to try convince and agency with 1100 contractors {allegedly} opted out then fill your boots.

Fixed that for you.

Again, I believe cojaks investigations that I just posted prove this is not true.

With due respect, I think cojak was misinformed.


Officially the PCG don't advise people either way but does anyone know what the PCG has to say about agencies forcing people to opt out? I seem to remember that they had an email address for reporting this but I've not seen any official statement from the PCG about agencies abusing the opt out provision that they lobbied for.

[NDawg]

From my reading of the law this is quite likely to be true.

However, the agency will choose to interpret the legislation their own way and it won't stop their bluff and bluster. Personally I think you could opt out and they would back down if it came to a legal dispute but it's not been tested in court and the agency could argue that by opting out, it shows that the intention of both parties was that the regulations should not apply.

Don't opt out if you can possibly avoid it.


Bulltulip.

If the client wants you then they will take you on. In fact, it's better for both you and the client if you don't opt out.

Of course the agency will sell the client a line of bulltulip trying to confuse the Agency Conduct Regulations with the Agency Worker Regulations and bulltulip the client into thinking that the opt out is somehow related to the AWR and therefore a good thing for the client.

I say take the do nothing option. Sit tight and see if you get offered the position. If you do then get them to send the contract and opt out form to you but don't sign or return the opt out form. When they start chasing you about it, just stall. When it comes to the crunch tell them that after taking legal advice your LTD has decided not to opt out.

If they threaten to withdraw the contract offer then it's time to go nuclear on them.

Point out that this is illegal under the Agency Conduct Regulations section 32(13) and your solicitor says that you could bring a civil action against the agency to recover the actual losses suffered by your company which could be up to the full value of the lost contract.

Also tell them that you will contact the client and explain in detail why you are not willing to opt out and how the agency conduct regulations protect both the client and the contractor.

It's hard ball but remember that the agencies do this sort of tulip day in day out. They KNOW they are bang to rights on this and they are pretty thick skinned about it. It's just business to them, nothing personal.

I'd originally planned on opting out then quoting the CUK article here if they gave me any trouble down the line, but I like this plan far more. Stalling on returning the form it is!

[northernladuk]

Just a thought on opting out later... The contract I was presented with was titled 'who is opted out' and this was all over other paperwork.. By signing a contract such as this would opting back in not then breach this contract or at least invalidate it?

[northernladuk]

I pragmatic approach, I do agree. The agencies are winning. I'm just waiting to pick a fight with one the next time an opportunity comes up...

This is exactly what I did to the point of pissing my agent off and then giving in hence feeling a bit cheesed off and not as eager to fight next time.

Fixed that for you.

Possibly but it was one of the bigger well known firms, not a 2 bit set up. Judging by the amount of effort I had to put in number of mails to and fro pointing out the flaws in their facts I can't help but believe what they say about not having a single Opted in person.

With due respect, I think cojak was misinformed.

Your evidence? (You do reaslise if you publically manage to prove her wrong you will get a perma ban of course )

Officially the PCG don't advise people either way but does anyone know what the PCG has to say about agencies forcing people to opt out? I seem to remember that they had an email address for reporting this but I've not seen any official statement from the PCG about agencies abusing the opt out provision that they lobbied for.

Maybe not but QDOS do and they are the contract specialists.

[timek]

IR35 statement from agency site,

opting out of Regulation 32, means that you are deemed to be self-employed in your own right and not a worker. Whilst there is no direct link between IR35 and the Conduct Regulations, to pass the HMRC test on employment status you need to take on business risk. Opting into Regulation 32, shows that no business risk is being taken.

I have been though this whole thread and still no clear about which is better for IR35

• Whilst there is no direct link between IR35

• to pass the HMRC test on employment status you need to take on business risk. Opting into Regulation 32, shows that no business risk is being taken

[Wanderer]

agency says to pass the HMRC test on employment status you need to take on business risk.

Agencies will talk such a load of nonsense to get you to opt out. This agency is grossly exaggerating the case in my opinion.

You don't NEED to take on business risk but yes it is a pointer if you actually make a loss on a contract. You can see the tests for yourself in HMRC's Business Entity Tests. You could counter that a prudent business person would use the statutory protection available in order to protect their business. Rather than creating an artificial risk, you should concentrate on the other ways to keep your business outside IR35.

Opting into Regulation 32, shows that no business risk is being taken[/B][/LIST]

It reduces your risk but it doesn't mean that there is no business risk. Not opting out reduces the risk of the client not paying but there is just as much if not higher risk that the agency will fail and not be able to pay you.

[timek]

Wanderer, I agree with your comments, its more prudent to reduce your risk, no matter what the size of Buiness, every company tries to reduce risk in any contract to ensure limited financial impact.

HMRC site doesnt mentioned anything about opt out / in being a factor in its IR35 decission making, however by by opt'ing out you are now taking on the extra risk.

As you said there are other ways to aovid the risk and reduce your exposure.

[malvolio]

Maybe not but QDOS do and they are the contract specialists.

I think Accountax, Abbey Tax and PCG may take issue with that statement...

[malvolio]

IR35 statement from agency site,

opting out of Regulation 32, means that you are deemed to be self-employed in your own right and not a worker. Whilst there is no direct link between IR35 and the Conduct Regulations, to pass the HMRC test on employment status you need to take on business risk. Opting into Regulation 32, shows that no business risk is being taken.

I have been though this whole thread and still no clear about which is better for IR35

• 
  Whilst there is no direct link between IR35

• 
  to pass the HMRC test on employment status you need to take on business risk. Opting into Regulation 32, shows that no business risk is being taken

PCG ran three people who had comprehensive IR35 victories at Tribunal through the Business Entity Tests. They all failed to score enough points and all fell into the high risk grouping (on the original PCG-proposed ones that HMRC ignored they all passed, incidentally). The BETs are a total crock of beans with no legal mandate.

There is an argument that says if you are outside IR35, you don't give a hoot about the Agency Regs becuse they simply don't apply so you are neither explicitly in or out of them: whatever is on your contract is what matters. Whatever, they have absolutely no bearing on IR35 (and very little bearing on anything else, if you're a genuine freelance).

[craig1]

Wanderer, I agree with your comments, its more prudent to reduce your risk, no matter what the size of Buiness, every company tries to reduce risk in any contract to ensure limited financial impact.

HMRC site doesnt mentioned anything about opt out / in being a factor in its IR35 decission making, however by by opt'ing out you are now taking on the extra risk.

As you said there are other ways to aovid the risk and reduce your exposure.

I increased my risk this morning by telling my wife that her butt was getting bigger. I now run the risk that she'll knacker me and I won't be able to go to work.

Seriously though, contractors run higher risks than employees as a matter of course as we operate as unsecured creditors for the agency until the money is paid to us. That's just the most obvious risk.

On the topic in general though, I got an email today for an application I'd submitted and been selected for interview for:
"As a part of our recruitment process we do require for you to complete the attached Opt Out Form.

The vacancy which you have applied for is that of a Contractor and therefore requires any applicant to opt out on the Conduct Regulations 2003 should they wish to be considered.

There is provision in the Conduct Regulations 2003 for companies and the workers whose services they supply to opt out of the Regulations."

My reply was fairly blunt. In summary: Too late as I'd already been introduced to client and even if it were not too late, I have no intention of filling in the form.