Reply to: Forced Opt-out of Agency Regulations

[Dow Jones]

We'll soon find out

MM, it's been drafted, just not announced yet. I'm relying on client's HR and agency info, sorry I haven't got a link.

[Moscow Mule]

I am told this is the likely scenario. Not misinforming, I'm only trying to steer him away from any pitfalls.
See if I care.

Have you got a source I can look at? AFAIK they haven't even drafted a bill yet so it's all up in the air.

[Dow Jones]

Ok then

I am told this is the likely scenario. Not misinforming, I'm only trying to steer him away from any pitfalls.
See if I care.

[Moscow Mule]

You sure want to 'opt-in' despite the latest news? If so, you are either stubborn or misinformed (probably both)

I'm not reading the whole of this thread (esp since Denny is involved), but you haven't got a clue that the proposed Temp equality measures will be included in the current employment business regulations.

Please stop spreading this mis-information.

[NAl-UK]

Dow Jones,

I'm not aware of the news you are talking about.
Can you please point me to any link / source?

I've been following the advice from http://www.contractoruk.com/news/001496.html

Conclusion

Overall, I find it difficult to see that there is any sound commercial reason why a contractor providing services through an agency would wish to opt out of the new regulations.

[Dow Jones]

Sure?

You sure want to 'opt-in' despite the latest news? If so, you are either stubborn or misinformed (probably both)

[NotAllThere]

“This is for the first time MB is dealing with any contractor who wants to opt-in”

[NAl-UK]

After launching complaint on BERR website, Madison Black’s director received a letter asking for clarification.

Then the Recruitment Consultant hurriedly called asking, “Why I’ve raised complaint”. Telling “This is for the first time MB is dealing with any contractor who wants to opt-in” (as if today was 1 Apr). And now she is chasing up all the departments to prepare the contract with Opt-in and get it signing by evening.

I’ll keep this post updated with the final results (hopefully soon).

[NAl-UK]

After serving (like a slave) for 1 full year under Opt-Out clause, at the time of renewal when I told the agency I would like to Opt-In to the regulation. The response was “it is Not Fair, and if you go direct that is Illegal”.
I just launched a complaint against Madison Black, and will share the progress.

The updated link is: http://www.berr.gov.uk/employment/employment-agencies
And click on "Complaint about an employment agency" on the top right.

[InPrincipal]

Forgive the banal question, but how did you report the agency to the DTI? Through their website, letter in the post and/or phone call?
Is this just for Ltd company contractors or can any contractor/freelance (even those working through an umbrella company) report a "dodgy" agency to the DTI?

I phoned and was told to complete the form on the website.
Go to
http://www.dti.gov.uk/employment/emp...page26998.html
And click on "Complaint about an employment agency" on the top right.

[pippo]

You can still do so, anonymously, if you wish.
Every little helps

Forgive the banal question, but how did you report the agency to the DTI? Through their website, letter in the post and/or phone call?
Is this just for Ltd company contractors or can any contractor/freelance (even those working through an umbrella company) report a "dodgy" agency to the DTI?

[InPrincipal]

I had experience of being coerced into signing an opt-out clause on one occasion, it was with a big agency. I wanted the contract at that time but thinking about it afterwards I felt the agency acted illegally. I had the feeling they wanted me to opt-out as that was the client's preference. I did not report the agency to the DTI at that time but I now think I should have done so.

I think you're quite right in reporting the agency to the DTI. Well done, you're setting a good example!

You can still do so, anonymously, if you wish.
Every little helps

[InPrincipal]

For one example, if you are trying to set up a contract for services, you really don't want individuals named in the contract, but if the agency doesn't do so, how valid are their efforts to ascertain the ID of the individual in question. And once you are individually named in the contract, it could be held to be a contract of service and hence inside IR35.

Similarly, guranteed payment terms means you cannot make a loss on the contract, hence it cannot be a commercial contract for services since there is no risk involved. And so on and so on...

Somewhat naive methinks. Companies breach payment terms every day of the week. How do you think contract lawyers make a living? There are never any guarantees in business. And even if there were, you can still make a loss - just ask my accountant. He's very good at that sort of thing . Maybe I choose to make a loss to break ground with a new client. Maybe I underestimated my expenses. There are always more maybes than guarantees, if you are really in business, that is, and not just disguised employment.

I'm in an opt-in (or more accurately, non-opt out, contract) but I'm not named in the contract. Only my company is. I have full rights of substitution. (But I've seen so-called IR35-friendly contracts with opt-out clauses where the individual has been named in an attached schedule. In such circumstances, the IR will see right through any lame attempt to bolt on "right of substitution" clauses.)

The onus is on the agency to verify the identity of any of the personnel my company chooses to supply - that is how they "add value" to a client.

If you examine the legislation carefully you will see that it is actually the limited company contractor (i.e. the company, not its workers) which is protected. It's not just about abused temps, or the Ltd Co stuff would never have made it in there.
As Denny says, opting-out puts the company at risk, ditto any bona-fide share-holders and this, ironically, makes it seem less like a legimate business and more like a tax cheat. There may also be insurance and access to business finance implications.

I'm sorry to labour the point, but I feel there are a lot of contractors out there who just don't know the score and who are happily signing away their companies' not inconsiderable rights because of agency pressure and lies. It is only ever legitimate ( from a business perspective) to sign an opt-out on commercial grounds. But when have you ever known an agency to pass on admin savings to a contractor? Opt-outs only put more money in pimps' pockets.

[pippo]

Has anyone had experience of being coerced into signing an opt-out clause in a contract?
...
However, it is illegal for them to force this and I am reporting one to the DTI for so-doing. Anyone else had any experience of this?

I had experience of being coerced into signing an opt-out clause on one occasion, it was with a big agency. I wanted the contract at that time but thinking about it afterwards I felt the agency acted illegally. I had the feeling they wanted me to opt-out as that was the client's preference. I did not report the agency to the DTI at that time but I now think I should have done so.

I think you're quite right in reporting the agency to the DTI. Well done, you're setting a good example!

[The Lone Gunman]

IR35 status:

Mal, Denny (be brief love).

I believe that the contract is required to show at least one of the IR35 pointers in that the contract has to state whether it is a contract of service or for services.
At the very least it should go to evidence against penalties.

Regulation 15 provides that an employment business must include in its agreement with work-seekers the following terms:
a) whether those work-seekers are or will be employed by itunder a contract of service (i.e. a contract of employment), or apprenticeship, or a contract for services, and the terms of employment or engagement that will apply;