Rumoured changes to public sector rules for contractors short sighted

IPSE, the Association of Independent Professionals and the Self Employed, has branded rumoured changes to how the public sector uses ‘personal service companies’ short sighted. Making the public sector client decide the employment status of freelance workers will lead to confusion among workers and added costs for the taxpayer.

Reacting to the reports, IPSE Chief Executive Chris Bryce said:

Independent professionals in the public sector are not employees, and attempting to change their employment status will lead to confusion for the workers and added cost to the taxpayer. Once you label a freelance business owner an employee, he or she will expect holiday pay, sick leave and other employee benefits which will have to be paid for by the taxpayer.

People who run their business through personal service companies may also decide they no longer want to take public sector contracts, and this means government departments will miss out on freelancers’ expertise – hitting the public sector’s ability to deliver vital projects, such as HS2 and Crossrail, in a timely and cost-effective way. This move is entirely against the Government’s declarations that it supports entrepreneurs and is working to reduce red tape. The Chancellor should reconsider making this announcement on Wednesday.

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