Reply to: Bench - the end client bench

[kingcook]

Could you not have a completely new contract drawn up and declare yourself IR35 caught for the 3 months? That gives you some income whilst looking for a new gig?

Having a split in/our IR35 gig is tricky IMO. It happened in the LJL case.

I wonder what would happen if OP decided to declare himself "in" for the 3 months, then got offered a contract "out" of IR35 afterwards. Does the fact that he was "in" for those 3 months therefore mean that he can only be "in" after that point -- i.e. returning to work for an "employer"?

[oracleslave]

I don't think it's outside IR35. Which was my whole point, to be honest. I can correct the end client, point out that if there's no work as there's no MOO I can sit at home unable to invoice. That then means I start a contract extension with no work, possibility of never getting any work.

Sadly I find Harry Potter more plausible than most deities...

Could you not have a completely new contract drawn up and declare yourself IR35 caught for the 3 months? That gives you some income whilst looking for a new gig?

[northernladuk]

To be honest it has been said on here before that it's not just at the end of a contract. I can't remember who it was - maybe Wanderer or Mal? It was towards the end of a fairly long thread I think, where both after and during contracts had been put forward, but there is some previous case law to say that it includes a client wanting you to keep a seat warm while they find you some more work.

If you search the forums then you'll find it's been asked before.

Yes but there are also threads that discuss MoO being over and above the contract so changed my mind a few times. It's very complicated and am sure there would be no black and white when if it hit the courts. I think this thread sums it up pretty well.

http://forums.contractoruk.com/busin...ct-clause.html

Again some useful reading for MUN and the OP as well.

EDIT : Even the pro's are not in total agreement as this article shows.

http://www.contractorweekly.com/cont...gation-extinct

It would appear HMRC accept there will be MOO within a contract so further muddying the waters. Have to read it all to get the context as they go on to discuss the opposite further down but here is an interesting snippet..

Where a worker undertakes duties for an engager and the engager pays the worker for carrying out the work then there will be sufficient MOO for a contract to exist. The question of MOO poses no difficulty during the period when the worker is actually working for the engager. For that duration the worker undertakes to work and the engager in turn undertakes to pay for the work done. The mutual obligations, i.e. to work on the one hand and to be paid on the other, will continue to exist until the contract is terminated and will provide the basic requisite mutual obligations.

[northernladuk]

It is an awkward one here as there is only one other guy in the project team and he basically comes and goes when he pleases (within reason) and is handled very informally as he has been here almost 20 years. The project manager is generally very relaxed about pretty much everything so there is not a massive difference in the way we are treated as the company rules are not really enforced on him.

Which, taken on face value, further makes me think they see you as part and parcel of the organisation. You need a different opinion though, maybe Mal, Wanderer or someone else that is pretty hot on IR35 can comment.

I am assuming this other person is a permie?

I have never brought in a sub, although contractually I can, so I am not sure exactly how I would specifically show I was outside IR35 when the only other person on the project has such flexibility. Other than trivial things like not needing to ask about holidays, needing timesheets signed etc.

However, this does not seem to be any different to how the many contract developers at BNPP worked when I was there etc.

I don't know either but a schedule of work with specific completion points would differentiate yourself from a permie. Just have to see what someone else thinks.

[Ticktock]

Although that quote does blow my opinion that mutuality is only after contract and not during

To be honest it has been said on here before that it's not just at the end of a contract. I can't remember who it was - maybe Wanderer or Mal? It was towards the end of a fairly long thread I think, where both after and during contracts had been put forward, but there is some previous case law to say that it includes a client wanting you to keep a seat warm while they find you some more work.

If you search the forums then you'll find it's been asked before.

[MyUserName]

Indeed but only you know the real situation at the client so you have to be super pragmatic.

It is an awkward one here as there is only one other guy in the project team and he basically comes and goes when he pleases (within reason) and is handled very informally as he has been here almost 20 years. The project manager is generally very relaxed about pretty much everything so there is not a massive difference in the way we are treated as the company rules are not really enforced on him.

I have never brought in a sub, although contractually I can, so I am not sure exactly how I would specifically show I was outside IR35 when the only other person on the project has such flexibility. Other than trivial things like not needing to ask about holidays, needing timesheets signed etc.

However, this does not seem to be any different to how the many contract developers at BNPP worked when I was there etc.

[northernladuk]

But if the new contract covers the work then surely that is fine? Or are you saying that updating a contract to reflect potential new work would be the problem?

But you said the work wasn't covered in your contract. You had no schedule? You could raise a contract for every piece of work but you have to look at the reality and the perception of the client. If the client just sees you as an enduring resource HMRC will see the contracts as a sham. Have a very careful read of this on the JLJ case. He started off with contracts and then just disappeared in to the system to be used as the client required. Some key paragraphs may be similar to your situation. Only you will know though.

IT contractor JLJ in first ever 'split IR35 case' :: Contractor UK

Such a lack of control is "fine" when the worker is providing expert services (judgement point 23) - on a unique project (point 42), but not, explains Ms Cottrell, when "the engager needs work undertaken repeatedly, and when you are working generally within the organisation."

Given that the classic tests of employment status have not changed, and therefore remain as significantly determining as they were before the case, the advisor believes such a work pattern is the "main" warning contractors should heed.

Mr Mason agreed: "For a contractor, the central message being sent by the courts is that if you're going to engage over a long period, then you really need to be able to show that you're engaged on specific projects.

"[To be outside IR35 you can't] just basically get on with whatever work crops up [from the end-user]. Do that and you risk ending up becoming very much part and parcel of their organisation.

"So if you're not doing separately identifiable and discreet projects, then it's very easy over an extensive period to be perceived as part of the client's furniture. That's what happened here and to my mind, that's Mutuality of Obligation."

Although that quote does blow my opinion that mutuality is only after contract and not during

Anyway, that paragraph is also something for the OP to consider as well.

Well, I think it is fair to say that sorting this ASAP with the client and QDOS to be priority number 1!

Indeed but only you know the real situation at the client so you have to be super pragmatic.

[MyUserName]

Which would be argued by HMRC as D&C as you are part and parcel of the workforce to do with as he pleases.

But if the new contract covers the work then surely that is fine? Or are you saying that updating a contract to reflect potential new work would be the problem?

Your role could also be classed as enduring so they have two lines of enquiry at least. Only you know your situation but you have to be pragmatic. Doesn't sound a very clever situation to me.

Well, I think it is fair to say that sorting this ASAP with the client and QDOS to be priority number 1!

[northernladuk]

The only thing that has just occurred to me is that we might be developing a new front end soon which is not in C++ so I will need to get that changed! I might try for it to just say "software developer" instead.

Which would be argued by HMRC as D&C as you are part and parcel of the workforce to do with as he pleases. Your role could also be classed as enduring so they have two lines of enquiry at least. Only you know your situation but you have to be pragmatic. Doesn't sound a very clever situation to me.

[northernladuk]

Regardless of contract/working practises, you're still exposed to that if HMRC speak to the right (wrong?) f***wit at the end client though. Especially if the end client is a large organisation with numerous companies providing services and a total lack of comunication...

Even so, my rationale for avoiding any "bench" system was explained earlier. The end client could accept that, send me home until work became available due to no MoO. Neither is a particularly good scenario for my business; bench = inside IR35, stay at home = no company income.

It's up to you what you do but do not kid yourself over your situation. When they need you they give you any old piece of work demonstrating D&C which is one of the key factors in IR35. I am not sure why you keep glossing over that.

I am still of the opinion that MoO isn't within in a contract. It's the obligation to give work once the contract has ended, like a permie. He has to have more work once he has completed his task. The company is obliged to give him another task. If the contract between you and the client is to give you work when it is available and send you home when it isn't then that isn't MoO, that is the agreement of the contract.

[northernladuk]

I don't have a schedule or work or a set deliverable. My contract just says I am to supply the service of a C++ developer, QDOS did not seem to have a problem with this?

I am very surprised at that but impossible to say why from a one liner. There maybe other factors but I would certainly be going back and asking them. Without a schedule you could potentially be moved to another job which would demonstrate client D&C. In a borderline case that lack of a schedule could bite you hard. Depends on working conditions of course which QDOS would have difficulty judging. Again, if HMRC contacted the client what would his view be?

[MyUserName]

Same, albeit a different language.

Surely there are some valid roles where a set deliverable cannot be established - ie, if providing support / bug fixing services then there's an obvious issue in that the work will be dependent upon external factors, when bugs get raised etc.

The only thing that has just occurred to me is that we might be developing a new front end soon which is not in C++ so I will need to get that changed! I might try for it to just say "software developer" instead.

[perplexed]

I don't have a schedule or work or a set deliverable. My contract just says I am to supply the service of a C++ developer, QDOS did not seem to have a problem with this?

Same, albeit a different language.

Surely there are some valid roles where a set deliverable cannot be established - ie, if providing support / bug fixing services then there's an obvious issue in that the work will be dependent upon external factors, when bugs get raised etc.

[b0redom]

Could be be considered as a retainer?

This? Or a support agreement? Presumably when you're on their bench you can wfh and pursue other short term engagements? MoO still holds right?

[perplexed]

Right. And one email from HMRC to the client asking what you do and they reply anything we need him for would shatter that illusion.

Regardless of contract/working practises, you're still exposed to that if HMRC speak to the right (wrong?) f***wit at the end client though. Especially if the end client is a large organisation with numerous companies providing services and a total lack of comunication...

Even so, my rationale for avoiding any "bench" system was explained earlier. The end client could accept that, send me home until work became available due to no MoO. Neither is a particularly good scenario for my business; bench = inside IR35, stay at home = no company income.