IPSE’s May Member Meet-UP: IR35 – Are you working via an umbrella, or have you managed to stay off payroll?

In our latest IPSE Member Meet-Up for May, members reflected on their experiences of IR35, working via an umbrella and the increasingly widespread involvement of indemnity clauses within contracts.

member meet-up May

Members were able to benefit from expanding their network and learn from each other’s experiences of dealing with the changing IR35 rules, hear tips on how best to negotiate contracts and deal with concerns about umbrella companies.

Discussions on umbrella companies, IR35, and more

The meet-up facilitated a discussion on the issue of umbrella companies withholding holiday pay, with some contractors explaining how they lost out because they weren’t warned about their end of year entitlements. Others also reported some umbrella companies were building holiday pay into their day rates.

Despite this, there were also reports of encouragingly positive practices from some umbrella companies: for example, giving contractors a choice at the start about how they wanted holiday to be paid – either quarterly, as a lump sum or covering the actual periods without work.

Concerns were also raised about the fact that some agencies are requiring contractors to engage via a certain umbrella company in order to secure the contract, giving the contractor the non-choice of using the umbrella company or losing the contract. The lack of regulation among umbrella companies has led to mounting allegations of bad practice and increasing calls for stronger umbrella market regulation.

Also discussed was recent research, which found that many clients have still not conducted SDS determinations since the implementation of the IR35 rules. Members agreed that some clients still seemed unaware or uninterested in engaging with the new rules.

We also heard interesting stories about how contractors had been able to successfully challenge indemnity clauses when negotiating new contracts – with tips for both the public and private sectors. There was frustration, however, that the indemnifying burden is being placed on contractors when clients should be covering indemnifying costs and not passing them down the supply chain.

Get involved

IPSE will be running more member meet-ups soon – not only to allow members to discuss and learn from each other’s experiences, but also so we can hear directly from members to inform our policies, research work and more.

IPSE Member Meet-Ups run on the last Thursday of each month. Spaces are limited to 30 to keep the sessions manageable, so if you’re interested in joining we recommend signing up early! Keep an eye out for an email about next month’s – coming soon.

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Meet the author

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Joshua Toovey

Senior Research and Policy Officer