Reply to: Advice needed - have to change umbrella for new contract

[LisaContractorUmbrella]

I dont know, how does it work for permies working for a normal consultancy? As per simple examples above?

That situation applies to permanent workers rather than workers who are engaged on a series of temporary assignments under an over-arching contract of employment.

[CoolCat]

Mutuality of obligation is an essential element of an over-arching contract - how would you prove obligation on the part of the worker if they were not obliged to take work offered as they had a relationship with another umbrella company

I dont know, how does it work for permies working for a normal consultancy? As per simple examples above?

[LisaContractorUmbrella]

Mutuality of obligation is an essential element of an over-arching contract - how would you prove obligation on the part of the worker if they were not obliged to take work offered as they had a relationship with another umbrella company

[CoolCat]

Re "a promise by the worker to work exclusively for the employer during the duration of the contract i.e. the worker can not work for anyone else, would be an obligation on the part of the worker" I doubt that is the full story. Its no different to working for a regular consultancy, being shopped out to various client sites, claiming expenses for all of it (normally claim to be home based so stepping out of the house is legit expenses). And you would be surprised the number of permie staff for consultancies who are able to work additionally for other people. From the obvious stuff like the TA, through to helping out at family shop at the weekend etc. I have never heard of tax man having a problem with this.

Some legit umbrella contracts explicitly allow you to work for someone else at the same time...

etc

[LisaContractorUmbrella]

Have been thinking about the OP's situation and I have discovered a slight obstacle to working for 2 umbrella companies at the same time. An umbrella company employee works under an over-arching contract of employment which maintains continuity of employment and creates a series of temporary workplaces under a global contract of services - HMRC's requirements for an over-arching contract include the following:

A definitive list cannot be provided as to what would suffice in relation to mutual obligations in the gaps between assignments. Some examples of provisions which may be present in a contract to support continuing obligations on the part of both the employer and the worker are:

an obligation by the worker to accept and do work and an obligation on the employer to pay a retainer during such periods when work was not offered;
the guarantee by the employer of a minimum number of hours work over a 12 month period would likely provide an obligation on the part of the employer (see ESM2045;
a promise by the worker to work exclusively for the employer during the duration of the contract i.e. the worker can not work for anyone else, would be an obligation on the part of the worker;
the requirement for the worker to work when required by the employer would be an obligation on the part of the worker;
the requirement for the worker to accept any assignments given would be an obligation on the part of the worker;
the requirement for the worker to work at any location as directed would be an obligation on the part of the worker.

Because an over-arching contract has to be in place in order for the contractor to claim travel and subsistence expenses I think working for two at the same time may invalidate it

[stek]

No. It's tautology.

I always get them arse about face!


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[LisaContractorUmbrella]

Isn't that an oxymoron?


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an oxymoron is something like 'an honest politician'

[TheFaQQer]

Isn't that an oxymoron?


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No. It's tautology.

[stek]

Thanks, that clarifies things more clearly.

Isn't that an oxymoron?


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[LisaContractorUmbrella]

That's true. Sounds a bit of a pain since I will then have to chase up to get my tax code changed again in 4 weeks!

Sorry but yes it will be a bit of a pain

[IrnBru]

No, it isn't - you would be obliged to complete section C of the P46 which is a declaration to say that you have another job - they would then have to apply a BR tax code (20% of everything) which may then be altered to D0 through a coding notice from HMRC if you are a higher rate tax payer

That's true. Sounds a bit of a pain since I will then have to chase up to get my tax code changed again in 4 weeks!

[LisaContractorUmbrella]

Ok I have asked the agency and as expected they said no to accepting the umbrella company I have already

However, they have also came back an said that they have spoke to Parasol and if I fill out a P46 then I won't get heavy taxed and I will still get paid with my other umbrella company.

Can any one confirm if this information is correct?

No, it isn't - you would be obliged to complete section C of the P46 which is a declaration to say that you have another job - they would then have to apply a BR tax code (20% of everything) which may then be altered to D0 through a coding notice from HMRC if you are a higher rate tax payer

[IrnBru]

Ok I have asked the agency and as expected they said no to accepting the umbrella company I have already

However, they have also came back an said that they have spoke to Parasol and if I fill out a P46 then I won't get heavy taxed and I will still get paid with my other umbrella company.

Can any one confirm if this information is correct?

[LisaContractorUmbrella]

Thanks, that clarifies things more clearly.

Anytime

[IrnBru]

Good point - do you want a job TF? and something you may like to point out to the agency that wants you to move - travel and subsistence expenses can only be claimed if you are travelling to a temporary workplace; if you only work on one assignment whilst in the umbrella company's employ it will automatically become a permanent workplace and the costs would not be allowable as expenses

Thanks, that clarifies things more clearly.