Every single IT project manager at a bank ever

[northernladuk]

You have proof the clause is not a sham it is in the contract you & the Agency both signed. The sooner people point out if they had no intention of obeying the contract the transfer of intellectual property, and NDA clauses in the contract are also void!

You were not party to the contract between the Agent & the client you can't be bound to it.

No you don't. HMRC and the judges are well aware they are just generic 'IR35 friendly' contracts and can have no bearing on the real working practices. This has been proved many times with case law, both in IR35 cases and general business contracts.

The bit in bold particularly is a clear problem. The client has no view or input to the contract between you and the agency. The client doesn't allow the sub but the agent has failed to take that in to account. The courts know this happens so the onus is on proving it.

It's been called out by a judge in an IR35 case in the past so there is precedent. Because of the nature of an agent providing standard contracts regardless of client it's not unreasonable for a court to need proof it's real.

[krytonsheep]

HMRC and the judges are well aware they are just generic 'IR35 friendly' contracts and can have no bearing on the real working practices..

In the case in question, the client unfortunately didn't give any evidence regarding substitution.


"Lee’s contract did include a legitimate unfettered right of substitution, but it was never exercised, and the client never gave witness evidence to back it up as a genuine right. As a result, the judges chose to disregard the substitution clauses, relying instead on Lord Wilson’s dominant purpose test in Pimlico Plumbers."

[Whorty]

Had an interesting chat with an agency the other day, he was adamant the contract was outside IR35 because the client was small. He said all contracts with small companies is automatically outside IR35.

Makes little difference to me as would be via umbrella, but does the small company clause just mean the onus is back on the contractor to determine IR35 status and not the client?

[mallisarealperson]

I've said this all along. People will say time has nothing to do with IR35 and they are wrong. It doesn't have anything to do with it if you are playging tickbox IR35. It's not one of the pillars or an automatic fail. BUT in every case thats gone forward time has been one of the major points of the case. Being there a long time causes people to lose track of their status and become part and parcel. JLJ lost part of his case on exactly this. He and the client got complacent and just fell in to a track which became inside. Looks like the same with this.

You can do 5 to 10 years on a client IF you play it by the book every single day from first to last. But that rarely happens. The client or the contractor get comfortable and forget so slip inside. The paperwork falls by the wayside, the working practices lose any meaning and bang, you are inside.

All that said, to limit contracts to 24 months to avoid IR35 is pretty naive at best. It shows you don't fully understand IR35 which is a red flag in itself. Done properly there is nothing wrong with long gigs and done badly even a three monther can go from inside to outside. There is not set time i.e. 24 months as you say, that keeps you on the right side of IR35.

A red flag is to stay at a client for numerous years, in my opinion.

I always worked on a contract for a project with defined timescales. And had my contracts reviewed. Done this for more than 15 years.

We will have to disagree with each other.

[vetran]

No you don't. HMRC and the judges are well aware they are just generic 'IR35 friendly' contracts and can have no bearing on the real working practices. This has been proved many times with case law, both in IR35 cases and general business contracts.

The bit in bold particularly is a clear problem. The client has no view or input to the contract between you and the agency. The client doesn't allow the sub but the agent has failed to take that in to account. The courts know this happens so the onus is on prooving it.

It's been called out by a judge in an IR35 case in the past so there is precedent. Because of the nature of an agent providing standard contracts regardless of client it's not unreasonable for a court to need proof it's real.

No there is an onus to prove it is not real. Innocent until proven guilty.

The Agent has issued a phoney contract with or without the worker understanding this, that has to stop. Make the Agent pay and it will stop.

a contract is an offer, consideration and acceptance. all three must exist and be agreed by both parties.

This fascination with ignoring written contracts because a hidden contract exists will bite them in the ass.

[northernladuk]

In the case in question, the client unfortunately didn't give any evidence regarding substitution.


"Lee’s contract did include a legitimate unfettered right of substitution, but it was never exercised, and the client never gave witness evidence to back it up as a genuine right. As a result, the judges chose to disregard the substitution clauses, relying instead on Lord Wilson’s dominant purpose test in Pimlico Plumbers."

Yep and there it is. The Contractor - Agency contract is just an off the shelf 'IR35 friendly' contract that has no bearing on the actual situation with the client. Sadly in 90% of cases they'd be quite correct as well.

[vetran]

A red flag is to stay at a client for numerous years, in my opinion.

I always worked on a contract for a project with defined timescales. And had my contracts reviewed. Done this for more than 15 years.

We will have to disagree with each other.

Crapita etc. are screwed then. That should fix the deficit!

[mallisarealperson]

Crapita etc. are screwed then. That should fix the deficit!

I see.

That is why I am not a wealthy early retiree like you lot on this forum.

£600 per day outside continuously for 15 years would be awesome

But breaks in contracts and travelling all over the bloody place. Working on projects. Cost money and hits your profit as a business.

That is why I am poor.

[northernladuk]

No there is an onus to prove it is not real. Innocent until proven guilty.

Yes but if there is precedent around these clauses then they won't take it on face value just because it's there. A cursory question to the client and boom, it falls apart. If sham clauses are the precedent then yes innocent till proven guilty but they will most definitely pick on it for you to prove it.

The Agent has issued a phoney contract with or without the worker understanding this, that has to stop. Make the Agent pay and it will stop.

a contract is an offer, consideration and acceptance. all three must exist and be agreed by both parties.

This fascination with ignoring written contracts because a hidden contract exists will bite them in the ass.

The agency should be held to account for situations that are proven to be shams. They negotiated the contract, they should be responsible for failings such as sham sub clauses. Sadly it's never happened that I'm aware of. I wonder what would happen if the guy in this case then tries to sue to the agent for misrepresentation.

[northernladuk]

A red flag is to stay at a client for numerous years, in my opinion.

I always worked on a contract for a project with defined timescales. And had my contracts reviewed. Done this for more than 15 years.

We will have to disagree with each other.

No disagreement, you are taking a low risk approach and kudos for you for doing so. I also totally agree long time at clients is an IR35 problem and have been shot down many times on here for arguing it.

I just think plonking a 24 month rule isn't strictly correct. Clients have 2 year rules where they get rid of contractors for IR35 reasons and it's wholly and completely wrong. You can have a 6 monther that falls inside and you can have a 6 year gig that is firmly outside. It just gets harder and harder to stay outside with length of time.

I think you are doing totally the right thing. I've left two clients because my IR35 status was in jeapordy, one was a year and a bit and the other was five. just pointing out the limit you put doesn't mean what you think.. but it doesn't matter. If it keeps you safe and you are happy doing it then fill your boots.