Dean Russell MP: 'IR35 not a reason for businesses to discriminante'

Following the announcement of IR35 being delayed for a year to 2021 due to COVID-19, there has been a noticeable uptick in the amount of contractor and business recruitment activity.

Robert Walters has noticed “an increase in companies (and contractors alike) getting in touch with them following the announcement.”

Stephen Barclay, chief treasury secretary announced on 17/03/20 in the House of Commons that IR35 is to be pushed back from 6th April 2020 to 6th April 2021. Prior to this announcement being made the House of Lords had requested that IR35 be pushed back due to the virus.

The Finance Bill Sub-Committee which was announced on 04/2/20 by the House of Lords had a specific focus on the extension of off-payroll working rules, chaired by Lord Forsyth of Drumlean. The House of Lords was asking for the reform to be delayed by at least six months to a year.

The recruitment firm has also stated that 2 million UK workers are contractors.

Chris Hickey, UK CEO at Robert Walters said:

Whilst it is too early to predict how this will change hiring patterns for the next year, we have already noticed an increase in companies (and contractors alike) getting in touch with us following the announcement.

Greater accessibility to contractors will no doubt help plug any short-term skills gaps we may likely experience in the coming months, as well as ease pressure on industries experiencing a particularly high level of demand – such as e-commerce, telecommunications, healthcare & pharma, and supply chain.

This extra year gives all parties involved extra time, like making improvements to HM Revenue & Customs (HMRC) Check Employment Status Tool (CEST). Nigel Morris, employment tax partner at MHA MacIntyre Hudson said:

The jury is still out on the CEST – it’s been given a resounding vote of ‘no confidence’ by users and their advisers. It will be an important tool for those involved with IR35, but the recently released revised version still appears to be flawed. Improvements would make for a much smoother adoption process.

Robert Walters does predict an increase in short-term projects for contractors around risk and compliance, change management, and tech infrastructure. They have also seen growth for contractors in Birmingham (72 per cent), Milton Keynes (31 per cent), Manchester (29 per cent), and London (19 per cent).