Is anyone noticing any impacts yet due to the IR35 changes? Either difficulties recruiting/retaining PMs in public sector, or more becoming available in the private sector as a result?
Tim, here in the states we have similar overly complicated and, IMO somewhat abusive tax treatment of independent contractors.
When our tax authority (IRS) expanded the rules around what constituted an employee vs independent contractor, many clients/sponsors in both the private and public sectors took the easy way out by insisting all contractors be classified as temporary employees, but with none of the benefits. This then affected staffing agency practices, such that today, many assignments are available exclusively as temp employee work, even though clearly this is not the case.
I'll be interested to see what our UK PM contractors have to say on the topic. Great post! Saving Changes...
Thanks Cris, that's very useful. How long ago did those rule changes take place in the US? Did it lead to more use of 3rd party companies to provide project management resources too? Saving Changes...
As for an increase in the use of 3rd party companies, the answer is yes. US businesses were relatively quick to transfer the risk, especially in the technology sector. If you look at a job site like Dice.com or Monster.com you'll see hiring criteria mentioned in the posts.
Even though the jobs are limited duration 'contracts', many are "W-2" only, meaning that the candidate must accept employee status with the recruiting firm if they want the job. While on it's face this does not seem to be a big deal, for true independent contractors who have established tax-advantaged small business, this is a step backward and potentially costs them money for every hour worked. Saving Changes...
Interesting article in today's Times newspaper about this (paywalled alas) - A whole project team of 15 at Guys and St Thomas Hospital has just left because of this.
Presumably there's nobody left to even look at the risk log.... Saving Changes...
Each country seem to change rules for independant worker from time to time.
It always has side effect.
I Belgium a few years ago they charge something that force a maximal duration of contract for independant worker. I understand it was to force corporation in hiring people if contract was longer then 2 years. Saving Changes...
