Substitution???

[northernladuk]

So, what happened in the end. Did you provide your client with what they asked?

I have been asked the same, but in addition they want potential substitutes names and qualifications.

Compete waste of time asking those and the client should know that. Even the big consultancies that use subs properly don't do this. I'd be concerned about your clients knowledge of IR35 and how to treat contractors if they are asking for this for many reasons.

[zonkkk]

Compete waste of time asking those and the client should know that. Even the big consultancies that use subs properly don't do this. I'd be concerned about your clients knowledge of IR35 and how to treat contractors if they are asking for this for many reasons.

I agree. They assessed my role outside, based in the substitution clause in the contract. The project manager doesn't care who does the work; apparently if they get this from me, it keeps the legal dep. happy...

[JohntheBike]

Cas law surrounding substitution

Is there any case law surrounding substitution where a contractual right of substitution, however fettered, was not accepted by any court, and declared a sham?

[northernladuk]

Is there any case law surrounding substitution where a contractual right of substitution, however fettered, was not accepted by any court, and declared a sham?

Yes'ish. Took me 30 seconds to find it on Google... Try it.

[JohntheBike]

Yes'ish. Took me 30 seconds to find it on Google... Try it.

I can't find an IT related one. The Autoclenz case wasn't really typical of our industry. I can find one which ruled the opposite way though, i.e. the contractual right of substitution over ruled the reality of the engagement.

So, can you point me to an IT related case, where IR35 was involved?

[zonkkk]

I can't find an IT related one. The Autoclenz case wasn't really typical of our industry. I can find one which ruled the opposite way though, i.e. the contractual right of substitution over ruled the reality of the engagement.

So, can you point me to an IT related case, where IR35 was involved?

Jensal Software Ltd vs HMRC 2017.

[JohntheBike]

Jensal Software Ltd vs HMRC 2017.

thanks

"Judge Dean acknowledged that there was some restriction on the right of substitution but was satisfied that the clause pointed away from an employment contract. Interestingly, she gave no weight to the fact that the clause wasn’t exercised, which could set precedents for future cases"

that would appear to support my contention that the contractual right of substitution was accepted. I'd like to see an IR35 case where the contractual right of substitution wasn't accepted and judged as a sham.

[northernladuk]

I can't find an IT related one. The Autoclenz case wasn't really typical of our industry. I can find one which ruled the opposite way though, i.e. the contractual right of substitution over ruled the reality of the engagement.

So, can you point me to an IT related case, where IR35 was involved?

Does it matter if it's IT related? You are the one that keeps telling us precedence is all. A failed case or judge calling a sub clause as a sham in any industry is going to put it under greater scrutiny across the board?

Not sure if you've seen this but I am sure you'll find this interesting.. and bore us to death about it.. but.

ESM0500 - Employment Status Manual - HMRC internal manual - GOV.UK

Scroll down and read ESM0533 onwards. ESM0535 particularly calls out the potential sham situations.

[JohntheBike]

Does it matter if it's IT related? You are the one that keeps telling us precedence is all. A failed case or judge calling a sub clause as a sham in any industry is going to put it under greater scrutiny across the board?

Not sure if you've seen this but I am sure you'll find this interesting.. and bore us to death about it.. but.

ESM0500 - Employment Status Manual - HMRC internal manual - GOV.UK

Scroll down and read ESM0533 onwards. ESM0535 particularly calls out the potential sham situations.

that's HMRC's (and their moles) take on it. But OK, point me to any case where the judge ruled the substitution clause as a sham and threw it out and then judged the individual as an employee.

[northernladuk]

that's HMRC's (and their moles) take on it. But OK, point me to any case where the judge ruled the substitution clause as a sham and threw it out and then judged the individual as an employee.

No.

And there will never be one. A case will not hinge on one point alone. It's too complex and a multitude of factors will need to be consider to make a judgement. I would have though if there was anyone on gods earth that would know this it would be you.

And another point, it's also even more unlikely to happen as substitution is less important as the other pillars, judges have commented on it and even Kate Cottrell has admitted it as so.

Anything to add to this thread that's useful now JtB or are you done?