Reply to: Attending team builds / team leadership meetings

[l35kee]

I hear this a lot from middle managers looking to be inclusive. You likely won't hear it from the HR department, and they almost certainly wouldn't reply in that manner to an HMRC query. It's well-meaning management BS. Would you believe them if they say that "our staff are our most valuable asset", "we are determined to be the most environmentally-conscious organisation in our sector", or "living according to our values is more important than making larger profits"?

I honestly wouldn't worry about it. Especially as a PM, it's sensible that you understand all factors which might impact your inbound and outbound dependencies, future funding, competition for key resources, agenda of your key stakeholders etc. Go along, learn, and use it to your advantage in your project.

This.. to a point. When I was a permie (in manager role) i made sure contractors were invited to any team gatherings where the objective was to foster a team spirit, thus hoping to improve quality/productivity etc.

We did not invite them to our annual Change Management meeting however, where we discussed the future of the department etc. But they came to pretty much everything else (I doubt HR were involved in any of it).

[Hobosapien]

It becomes second nature to question every invite and meeting as whether it would look like employee behaviour or could be treated as managing client expectations, then find a reason to decline or not attend if it looks too dodgy.

The most obvious sign they're treating contractors like staff is if they expect the contractors to undergo staff appraisals, which goes without saying is a run for the hills moment.

[Artois]

Thanks for all your replies. It's a bit of a tricky one. Ur I guess I need to decide whether the fancy meals and offsites are worth a small risk of being up for a big fine if I'm audited ...!

[Lambert Simnel]

The rationale is that "we do not view permanent or contract staff as being different".

I hear this a lot from middle managers looking to be inclusive. You likely won't hear it from the HR department, and they almost certainly wouldn't reply in that manner to an HMRC query. It's well-meaning management BS. Would you believe them if they say that "our staff are our most valuable asset", "we are determined to be the most environmentally-conscious organisation in our sector", or "living according to our values is more important than making larger profits"?

I honestly wouldn't worry about it. Especially as a PM, it's sensible that you understand all factors which might impact your inbound and outbound dependencies, future funding, competition for key resources, agenda of your key stakeholders etc. Go along, learn, and use it to your advantage in your project.

[MrMarkyMark]

If they were investigated by HMRC then then company is very unlikely to prejudice itself. My point was around the acceptance of plainly ridiculous guidance designed to scare contractors into paying PAYE levels of tax. The link to the case from 2011 is good and I'll read it in detail later but it's obviously not a precedent that HMRC is willing to use in anger. I'm all for a business to business relationship but it has to be practical.

Oh for sure, hence why I said I wouldn't have lumped all his concerns into one.

Also, its is good he is at least questioning it, a lot don't.

[radish2008]

Good points.

The ongling relationship you will have with the client goes right back to when you first engaged with them.
Hence why all contractors within an org are not treated the same.

If they were investigated by HMRC then then company is very unlikely to prejudice itself. My point was around the acceptance of plainly ridiculous guidance designed to scare contractors into paying PAYE levels of tax. The link to the case from 2011 is good and I'll read it in detail later but it's obviously not a precedent that HMRC is willing to use in anger. I'm all for a business to business relationship but it has to be practical.

[MrMarkyMark]

I probably wouldn't (and haven't several times) refused free food and drink

What's in case law isn't the only thing you should be thinking of. Just because something hasn't happened in the past, doesn't mean it won't in future.

But yeah, you're right, it might be unlikely that a case would be won or lost based on this, but the company explicit says "we do not view permanent or contract staff as being different". If you needed to sum up IR35 in one sentence, I would struggle to find a better definition of inside than that. The company view him as an employee, if you're investigated and HMRC ask them about your relationship, do you want that to be the answer?

Good points.

The ongling relationship you will have with the client goes right back to when you first engaged with them.
Hence why all contractors within an org are not treated the same.

[FrontEnder]

Totally disagree with most of the replies here.

You're obviously a valued member of their team and they value your opinion. It doesn't make you an 'employee' at all to attend their functions or drink their drinks. Are you supposed to put your fingers in your ears if someone starts talking about a project not explicitly mentioned in your schedule ?

Can someone point me to some case law where people have been declared as inside IR35 and paid all back taxes based on the reasons given in these replies ?

I probably wouldn't (and haven't several times) refused free food and drink

What's in case law isn't the only thing you should be thinking of. Just because something hasn't happened in the past, doesn't mean it won't in future.

But yeah, you're right, it might be unlikely that a case would be won or lost based on this, but the company explicit says "we do not view permanent or contract staff as being different". If you needed to sum up IR35 in one sentence, I would struggle to find a better definition of inside than that. The company view him as an employee, if you're investigated and HMRC ask them about your relationship, do you want that to be the answer?

[SueEllen]

Totally disagree with most of the replies here.

You're obviously a valued member of their team and they value your opinion. It doesn't make you an 'employee' at all to attend their functions or drink their drinks. Are you supposed to put your fingers in your ears if someone starts talking about a project not explicitly mentioned in your schedule ?

If the OP really doesn't like this then he needs to talk to the other contractors and those of you who are clued up on IR35 need to work to ensure that you don't attend the parts of the meetings that aren't relevant to you. (Though if it is a 5 minute segment in the middle you will just get an apology before they talk about it. for those few minutes.)

However some of your work as a contractor is consultancy and that means improving the clients' processes. If you are on the ball you ensure your schedule has this written into it. Another part is seeing if you can pick up more work e.g. another project which those meetings help you in doing.

Can someone point me to some case law where people have been declared as inside IR35 and paid all back taxes based on the reasons given in these replies ?

This is the case NLUK is referring to linky

[MrMarkyMark]

About six months ago I started as a PM at a finance services firm.

Central team of PMs and BAs, at least half are contractors. All farmed out to various projects.

This company has an inordinate amount of team builds, offsides and team build / planning sessions. Both permie and contractor staff are expected to attend these sessions. Sessions for the central projects team, not project specific. So far I have hiked in the country, been to an expensive dinner and drinks in the city, and have been asked to participate in team "leadership meetings" where management asked us PMs how the reporting lines of the team should be organised - i.e. BAs and where they should be placed.

I have attended most of these meetings as every single person did. The rationale is that "we do not view permanent or contract staff as being different". I have never experienced this elsewhere- I've never gone to team builds except if they were project related.

I have usually just bitten my tongue and gone along. But given all the IR35 debacles in the press, I am now getting concerned about the IR35 implications of these events.

Am I mad for agreeing to attend these things in the past? Would putting an end to it and refusing to attend more team builds help avoid any further IR35 consequences? I really do feel that I look like a "disguised employee" in the words of HMRC.

Thanks ..

Some of this could be considered iffy, the team building away days, for one, I'm guessing funded by Client Co?
Some of it could be considered consultancy in preparation for those (new) projects going into BAU.

Dealing with these sorts of issues is a careful balancing act.
However, even within an organisation not all contractors are treated the same, even by the same engagers / Client Co Management.

[northernladuk]

Can someone point me to some case law where people have been declared as inside IR35 and paid all back taxes based on the reasons given in these replies ?

Not on this alone but it can look like part and parcel. The JLJ partial win by HMRC references part and parcel as a key point.

This alone might not be a problem but it's a big warning flag. Too much of this stuff and you are going to lose the part and parcel argument as did Mr Spencer.

[oscarose]

Totally disagree with most of the replies here.

+1

Sounds like a delusion of grandeur.

Get to the meetings and carry on invoicing.

[radish2008]

Totally disagree with most of the replies here.

You're obviously a valued member of their team and they value your opinion. It doesn't make you an 'employee' at all to attend their functions or drink their drinks. Are you supposed to put your fingers in your ears if someone starts talking about a project not explicitly mentioned in your schedule ?

Can someone point me to some case law where people have been declared as inside IR35 and paid all back taxes based on the reasons given in these replies ?

[FrontEnder]

And this is the problem. In a way you're being unprofessional in letting your personal tax situation interfere with your client's business; it is after all not their problem: they just see someone not doing what's required. Only thing is they probably should have been more up front about it from the outset so you knew you were taking an inside IR35 contract.

I did this one before when "all staff" were required to attend some training thing and I got all militant and said "I'm not staff". Of course all the other contractors went.

More fool them then.

I suppose it depends who is saying this. If it's from somewhere up high and it's a well established company stance, it's not a good place to be in. But it might just be some middle manager or PM saying it, in which case, it might be easier to deal with and "educate" them.

[VectraMan]

If that's their attitude in general, then you're well inside regardless.

Although you could point out that you're not contract "staff". You're a supplier to them, not staff.

And this is the problem. In a way you're being unprofessional in letting your personal tax situation interfere with your client's business; it is after all not their problem: they just see someone not doing what's required. Only thing is they probably should have been more up front about it from the outset so you knew you were taking an inside IR35 contract.

I did this one before when "all staff" were required to attend some training thing and I got all militant and said "I'm not staff". Of course all the other contractors went.