FTCs: the future of contracting?

[LondonManc]

FTC - but of the agency.

You are supplied in as an FTC employee of the agency, doing a 50k perm job on 90k FTC. Expenses negotiated as part of the gig, etc. Standard rules on no paid holidays/sickness, blah blah blah.

Benefits:
Saves the client worrying about IR35 at all
Means that no IR35 understanding is needed by the agency - a big smoke and mirrors area
Potential to see expenses included in negotiation as appropriate (pre-take home pay equivalent) to offset against anti-IR35 practice

Down side:
No outside IR35, maxing of revenue through MyCo, etc
PAYE rates
Less freedom of the individual, messy pension system?

Thoughts?

[northernladuk]

Are you an FTC or an employee? FTC's have been around awhile and we've also seen agents trying to employ contractors in the past. I posted a thread on this not long ago. https://www.contractoruk.com/forums/...tml?highlight=

FTC is fine. It has an end date and you know the score. Employing them isn't (IMO). You think you've go rights and are safe but you will get dropped as soon as the contract you are working for ends. They won't be moving you around like a consultancy or anything.

Try and define if it's FTC or fully employed.

[jamesbrown]

Are you an FTC or an employee? FTC's have been around awhile and we've also seen agents trying to employ contractors in the past. I posted a thread on this not long ago. https://www.contractoruk.com/forums/...tml?highlight=

FTC is fine. It has an end date and you know the score. Employing them isn't (IMO). You think you've go rights and are safe but you will get dropped as soon as the contract you are working for ends. They won't be moving you around like a consultancy or anything.

Try and define if it's FTC or fully employed.

An FTC is employment. It's a fixed term contract of employment, as distinct from a permanent/indefinite term contract of employment (for whatever "permanent" is worth).

[Paralytic]

An FTC is employment. It's a fixed term contract of employment, as distinct from a permanent/indefinite term contract of employment (for whatever "permanent" is worth).

Do FTCs typically have the same "if your timesheet is not approved, you don't get paid" gotcha, or are employees guaranteed that salary for the full term (barring getting sacked for gross misconduct etc)? Or could they just be made redundant after, say, 3 months?

[jamesbrown]

Do FTCs typically have the same "if your timesheet is not approved, you don't get paid" gotcha, or are employees guaranteed that salary for the full term (barring getting sacked for gross misconduct etc)? Or could they just be made redundant after, say, 3 months?

No, it's employment. You cannot treat an FTC unfavourably w/r to comparable permanent employees (there are ways to justify some differences), so there is that level of parity. Obviously, there are downsides too and I personally see an FTC as a worst-of-all-worlds option. A permanent position doesn't grant you any less flexibility as a worker, AFAICT. It mainly benefits the employer.

[Paralytic]

No, it's employment. You cannot treat an FTC unfavourably w/r to comparable permanent employees (there are ways to justify some differences), so there is that level of parity. Obviously, there are downsides too and I personally see an FTC as a worst-of-all-worlds option. A permanent position doesn't grant you any less flexibility as a worker, AFAICT. It mainly benefits the employer.

Thanks, but they could just be made redundant after 3 months. Which just happened to be when the big contract the employee was working on was canned. But, of course, the employer will have followed due process and selected the most appropriate role for redundancy. Less than 2 years tenure, limited comeback.

Doesn't sound like a lot more protection than a contract.

[jamesbrown]

Thanks, but they could just be made redundant after 3 months. Which just happened to be when the big contract the employee was working on was canned. But, of course, the employer will have followed due process and selected the most appropriate role for redundancy. Less than 2 years tenure, limited comeback.

Doesn't sound like a lot more protection than a contract.

Yup, there isn't much more protection; there is some (plus benefits), but you lose a lot for that. Hence, worst of all worlds, IMHO. Also, FTCs aren't going to be paid more than permies.

[BR14]

aye, - right.
still looking for the magic wand.

get real, people. FFS.

[northernladuk]

An FTC is employment. It's a fixed term contract of employment, as distinct from a permanent/indefinite term contract of employment (for whatever "permanent" is worth).

Correct and maybe down to my wording but it's that distinction you describe that anyone needs to nail down when looking at these. There is also the assumption the poster and others understand the wording as well. We have 2 threads on agencies employing people which isn't FTC.

So correct but the wording needs to make sure there is the distinction you mention.

[ladymuck]

FTC - but of the agency.

You are supplied in as an FTC employee of the agency, doing a 50k perm job on 90k FTC. Expenses negotiated as part of the gig, etc. Standard rules on no paid holidays/sickness, blah blah blah.

Benefits:
Saves the client worrying about IR35 at all
Means that no IR35 understanding is needed by the agency - a big smoke and mirrors area
Potential to see expenses included in negotiation as appropriate (pre-take home pay equivalent) to offset against anti-IR35 practice

Down side:
No outside IR35, maxing of revenue through MyCo, etc
PAYE rates
Less freedom of the individual, messy pension system?

Thoughts?

You can't be on an FTC with an agency, it has to be direct with the company you're doing the work for.

You should get the same or equivalent benefits as a 'real' employee but there may be practical reasons for not giving the full suite of benefits (HMRC in the link below use the rather silly example of not giving a company car to someone on a 3 month FTC due to the cost).

You become a permanent employee if you're on a FTC for 4 or more years, although there seems to be a sneaky get-out from this.

Fixed-term employment contracts - GOV.UK