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End client says outside, intermediary says inside-and won't provide SDS(or reasoning)

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    End client says outside, intermediary says inside-and won't provide SDS(or reasoning)

    Bit of an odd one: I've been with a public sector client for over a year, who confirmed at start of contract I was determined as outside IR35. However, intermediary has just determined me as inside, apparently using a large external consultancy. They're refusing to provide an SDS or any reasons behind the determination - just verbal confirmation so far. (Despite that I've already having pointed out why I'm outside - and have even referenced relevant questions in CEST and provided evidence to back this up.)

    Seems that they're trying to argue that the new IR35 rules don't apply until 6th April, so they have no obligation to provide reasoning - or a dispute process. However, if that was the case, wouldn't they be unilaterally changing Ts&Cs? If they've done a determination, doesn't the existing legislation at least require them to provide reasoning?

    I know that in reality I've probably only got two options: (i) suck it up, contract inside through their appointed umbrella and try to dump all my salary straight into my pension - until I get something else, or (ii) leave before 31st March and explore legal options re: breach of contract.

    Any thoughts?

    Many thanks in advance!


    #2
    First, forget the breach of contract idea - that'll get you nowhere.

    Secondly, who is your contract actually with ? The client or the intermediary? And is there an agency in between? You say the intermediary has determined you inside, but that it does not come into effect till April 6, so what are they actually asking you to do? You then mention an Umbrella. Are they asking you to go via an Umbrella from April 6?

    When does your current contract end? Are the proposing a change to your existing contract or a new one from April 6?
    Last edited by Paralytic; 18 March 2021, 15:50.

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      #3
      A better question is who has responsibility for the SDS - is the intermediary providing a complete service (in which case it is them) or are they provided resources that are managed by the public sector client (in which case its the client).

      Now technically you do not need to receive an SDS before April 6th but you can insist on one at that date.

      And you can appeal and you do need to provide written reasons for the appeal.

      Personally though it will be a complete waste of time so I would start contract hunting.
      merely at clientco for the entertainment

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        #4
        Thank you both for the speedy replies. Contract is with intermediary (acting as agency - no other parties involved). Options presented are (i) umbrella from 6th April or (ii) last day 5th April. Current contract due to run for another year, four weeks notice. A bit vague at moment (through various layers of 'management'), but expecting new contract through umbrella.

        Contract between intermediary and end client is a service. To get an SDS on 6th April, I'd need to confirm before that date that I'm going down the umbrella route. I'm with you eek re: SDS appeal though - not worth the bother. Heart definitely says jack it in (and I do have a contingency fund).
        Last edited by 6squid; 18 March 2021, 16:09.

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          #5
          Originally posted by 6squid View Post
          Thank you both for the speedy replies. Contract is with intermediary (acting as agency - no other parties involved). Options presented are (i) umbrella from 6th April or (ii) last day 5th April. Current contract due to run for another year, four weeks notice. A bit vague at moment (through various layers of 'management'), but expecting new contract through umbrella.

          Contract between intermediary and end client is a service. To get an SDS on 6th April, I'd need to confirm before that date that I'm going down the umbrella route. I'm with you eek re: SDS appeal though - not worth the bother. Heart definitely says jack it in (and I do have a contingency fund).
          The important bit isn't who the contract is it's who is responsible for the determination.

          However given that this is the public srctor unless they are paying you before April 6th you need to leave today because

          From Page 5 of the HMRC presentation I attended.

          Payments to which the new rules apply

          For engagements where the client is a public sector organisation operating under
          the 2017 rules.
          • The new rules will apply to any payment made after the 6 April 2021

          For engagements where the client is a medium or large-sized non-public sector
          organisation.

          • The new rules will apply to any payment for services made on or after 6 April
          2021, and those services are provided by the worker to the end client on or
          after 6 April 2021
          I would ask the end client (i.e. the public sector client) what is going on as currently my advice would be to leave tomorrow and insist on payment by April 5th.

          I would also suggest asking your agency where they are getting their advice from as it's clear they haven't attended any of HMRC's workshops on IR35 (and HMRC ran them daily for about 3 weeks).
          Last edited by eek; 18 March 2021, 16:16.
          merely at clientco for the entertainment

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            #6
            Good point: it's a while since I've had to dive into all the detail, so I'd forgotten about when payments are made. That would explain their urgency to get a decision tomorrow. Luckily, I get paid every two weeks, so I'd have to make tomorrow my last day.

            Comment


              #7
              Originally posted by 6squid View Post
              Good point: it's a while since I've had to dive into all the detail, so I'd forgotten about when payments are made. That would explain their urgency to get a decision tomorrow. Luckily, I get paid every two weeks, so I'd have to make tomorrow my last day.
              Don't worry a whole host of this detail has been completely lost - were it not for me attending a workshop to try to get a completely different question answered none of us would know this.
              merely at clientco for the entertainment

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