Just to add to the doom, two big IR35 losses

[SueEllen]

Cant we sue the HRMC for something ?

Nope the government will just bring in new legislation.

[tim123]

The SC also said he didn't belive that the substitution clause was valid despite a letter from the AA saying it was valid.

The judge said the following. He obvious thought that the first three paras were stronger than the last

11. Mr Kersley said he was aware that substitutes had been used. He said that if a contractor wished someone to substitute his attitude would depend on the circumstances and upon who recommended the substitute; he would almost always want a second opinion from someone he trusted and would want to see a C.V. He said that he would be unhappy if a substitute turned up unannounced and unforeshadowed : that just would not happen. In any event to work on the premises a security card was needed. I accept that evidence.

12. Mr Palmer’s evidence was that he expected Mr Bessell to do the work personally and would not have expected him to send a substitute. If Mr Bessell had been unable to perform then he thought that he would have been replaced by a worker engaged through the normal procedures including interviews with new workers. I accept that as evidence of what Mr Palmer would have done.

14. Mr Bessell, when asked if Miss Tooze could have decided that she did not want a substitute, replied “absolutely”.

15. The letter from Christine White offered in evidence by the Appellant indicated that on one occasion she was approached by one of the contractors in her team, and that it had been agreed that a substitute whose work the contractor had guaranteed could be provided while he was away. This she said had worked well in practice and she had been content to allow it again with other contractors. The letter did not indicate the dates or period when this was done. Given the evidence of Mr Kersley and Miss Tooze I accept that there was an occasion when a substitute was agreed but I do not regard this letter as compelling evidence that in the relevant period substitution was generally permitted or permitted without prior consent.

I would say partly stupid contractor for representing himself, ...

He was represented by Accountax
tim

[tim123]

(most notably by ignoring the RoS case law that it only has to exist as a right)..

There is no such case law. All the established case law requires that the RoS actually has to be exercisable.

The judge is perfectly entitled to ignore it, if he believes it would not be allowed by the client to be exercised and there are previouse cases where a judge has done exactly that.

This idea that simply having an RoS clause in your contract is enough, is a fiction which certain parties have been trying (unsuccessfully) to turn into a fact.

tim

[IR35 Avoider]

Lots of comments in this thread about some of the 99K being penalties, but I believe there wouldn't normally be any penalties for getting an IR35 decision wrong. (There would only be penalties if your judgement in assessing your status was so wrong as to be negligent.)

[Denny]

There is no such case law. All the established case law requires that the RoS actually has to be exercisable.

The judge is perfectly entitled to ignore it, if he believes it would not be allowed by the client to be exercised and there are previouse cases where a judge has done exactly that.

This idea that simply having an RoS clause in your contract is enough, is a fiction which certain parties have been trying (unsuccessfully) to turn into a fact.

tim

What this amounts to is this: if you don't actually bring in a sub then the terms could well be neutralised and deemed null and void in practice. The only way to mitigate against the added risk if you're not likely to substitute is to get the client to sign a confirmation of working arrangements document to confirm what is arranged in the unseen upper contract.

It's a huge set back for most contractors, particularly those who operate through EBs.

[Denny]

The judge said the following. He obvious thought that the first three paras were stronger than the last

11. Mr Kersley said he was aware that substitutes had been used. He said that if a contractor wished someone to substitute his attitude would depend on the circumstances and upon who recommended the substitute; he would almost always want a second opinion from someone he trusted and would want to see a C.V. He said that he would be unhappy if a substitute turned up unannounced and unforeshadowed : that just would not happen. In any event to work on the premises a security card was needed. I accept that evidence.

12. Mr Palmer’s evidence was that he expected Mr Bessell to do the work personally and would not have expected him to send a substitute. If Mr Bessell had been unable to perform then he thought that he would have been replaced by a worker engaged through the normal procedures including interviews with new workers. I accept that as evidence of what Mr Palmer would have done.

14. Mr Bessell, when asked if Miss Tooze could have decided that she did not want a substitute, replied “absolutely”.

15. The letter from Christine White offered in evidence by the Appellant indicated that on one occasion she was approached by one of the contractors in her team, and that it had been agreed that a substitute whose work the contractor had guaranteed could be provided while he was away. This she said had worked well in practice and she had been content to allow it again with other contractors. The letter did not indicate the dates or period when this was done. Given the evidence of Mr Kersley and Miss Tooze I accept that there was an occasion when a substitute was agreed but I do not regard this letter as compelling evidence that in the relevant period substitution was generally permitted or permitted without prior consent.

He was represented by Accountax
tim

Accountax take quite an aggressive, head-on-head approach to legal disputes, apprarently, unlike Qdos who prefer to do all they can to prevent the cases getting to the SC in the first place. Perhaps if they had been the representatives for this case the outcome may have been different. Qdos had successfully defended against upper contract considerations in the past -that's why I went with them.

[Bumfluff]

What do you recon the cost was of representing the contractor ? Just wondered as I have insurance for cost of investigation for £50k or something and wondered if that is enough.

Found this on Qdos site comment about the cases > http://www.qdosconsulting.com/qdosma...e=bczs4dq1kw96

[Denny]

There is no such case law. All the established case law requires that the RoS actually has to be exercisable.

tim

To tell you the truth, that's why I was happy to ditch my last contract after three days. I actually did see the upper contract, reviewed how they were representing my company name and made sure it matched the lower contract.
Qdos checked both and cleared both. In both sets of terms I had full rights of substitution, but I remember one who interviewed me from a panel of 4 still wanted me to reassure her that I wouldn't actually carry it out in practice. At the time the terms were exchanged I didn't feel it was an issue: it was in the contract both upper and lower, after all, and wasn't that all that mattered? But that was before this Lakeland ruling. It was obvious, even then, in the light of this recent ir35 loss, that the RoS was going to be a sham despite what the upper contract said.

When I started the role there were all other kinds of nasty surprises that entailed more D&C than I was prepared to tolerate as well.

So I set up a meeting to discuss on my third day, and when it became apparent that they weren't prepared to honour a true ir35 compliance working arrangments I'd discussed during interview and during terms negs on many critical points I told them I was going from immediate effect because the gig was unworkable for me. The end client then terminated on my behalf but reassured me that the consulting company I had subbed through paid me off the equivalent of 2weeks over and above the 3 days I had actually worked.

The official reason for the termination by the client was 'poor cultural fit' which was partly true if their culture was to mislead and say all the right things but expect something very different. What a euphemism for 'we tried to screw you on the terms in practice but realised we couldn't get away with it because you actually wanted to work like that as well.' Still, the end client reps were professional and nice about it as they realised they were largely at fault for misleading me on the situation in the first place. To be fair to them, they probably thought that I would just conform to normal de facto working patterns of all their other contractors and staff now that all the paperwork had been nailed down with all the right words on. So they didn't know what to expect either until after I'd started.

It was a shame really, because the gig would have been a good 'un if everything had panned out as expected.

[Board Game Geek]

Why does it all have to be so complicated ?

What ever happened to :

Client : I need XYZ done. What's your rate ?

Contractor : £X / hour

Client : Okies, that's good. Can you do it in 6 months ?

Contractor : Yup, no worries. When do I start ?

Client : 1 week, 2 weeks, whatever is convenient to you.

Contractor : I'm on holiday for 2 weeks, so I'll see you after that.

Client : Sorted.

[Ardesco]

The judge said the following. He obvious thought that the first three paras were stronger than the last

11. Mr Kersley said he was aware that substitutes had been used. He said that if a contractor wished someone to substitute his attitude would depend on the circumstances and upon who recommended the substitute; he would almost always want a second opinion from someone he trusted and would want to see a C.V. He said that he would be unhappy if a substitute turned up unannounced and unforeshadowed : that just would not happen. In any event to work on the premises a security card was needed. I accept that evidence.

12. Mr Palmer’s evidence was that he expected Mr Bessell to do the work personally and would not have expected him to send a substitute. If Mr Bessell had been unable to perform then he thought that he would have been replaced by a worker engaged through the normal procedures including interviews with new workers. I accept that as evidence of what Mr Palmer would have done.

14. Mr Bessell, when asked if Miss Tooze could have decided that she did not want a substitute, replied “absolutely”.

15. The letter from Christine White offered in evidence by the Appellant indicated that on one occasion she was approached by one of the contractors in her team, and that it had been agreed that a substitute whose work the contractor had guaranteed could be provided while he was away. This she said had worked well in practice and she had been content to allow it again with other contractors. The letter did not indicate the dates or period when this was done. Given the evidence of Mr Kersley and Miss Tooze I accept that there was an occasion when a substitute was agreed but I do not regard this letter as compelling evidence that in the relevant period substitution was generally permitted or permitted without prior consent.




He was represented by Accountax
tim

I may be getting this one mixed up with the MKM Computing Ltd one, or I could be just totally wrong