A thing about Numbers

[Suff]

In this case 19 and 35.

Yes I know I'm being very obscure, but both are dear to my bank balance.

Covid-19 caused a delay in IR35 being implemented, but then the Government went ahead and implemented it anyway even though the impact of Covid-19 to the contractor market was not fully out of the system.

IR35 has a simple impact. It takes average taxes for a Contractor from around 25% to 35% to a minimum of 62%.

Covid-19 has had an impact on contractors because of all that home working. People have become used to it over time but they have absolutely Zero clue what it did to the IT infrastructures they use. These were in no way prepared for the levels of home working that occurred during the lockdowns and after; even today. System security wasn't even close to that required to have most workers connecting via public internet into the company. Meaning that both staff and systems have been stressed to the hilt.

I work in security these days. So I'm at the coal face of this. I see it every day.

When the run up to IR35 was happening back in 2020, I was pretty clear that the attitude of the banks and pharma would come back to bite them in the ass. Simply put they said they were not going to take the risk, or the cost, of assessing their roles. They would simply assess all roles as inside and that was the end of it. We, the contractors, would take all the risk and all the cost.

Today I received a job offer. Urgent contract job, inside IR35, for a Bank. £1,115 a day. This is a near 100% uplift from standard rates in 2019. The job market is buoyant, security people are in demand, nobody has to play the IR35 game with Banks and Pharma if they don't want to.

I didn't laugh, just a wry smile and a shrug as I replied to the pimp (agency), as to the likelihood of my taking a job inside IR35 for a company who couldn't be bothered to do their due diligence and actually work out if it was a real contract job or just a contractor backfilling a day job.

Not at that price and not at twice that price.

Why you might ask, clearly "twice that price" is crazy money even with IR35. Sure it is. But the impact of IR35 on short staff will, eventually, go away. It will hurt the banks and pharma Far more to be denied staff now; when they need them so badly, than a bit more cash in the pocket. More cash and they will take revenge later. No bodies and failed projects and government regulatory findings and they will gain a level of respect no amount of money will teach them.

In the end it is not all about numbers. Even when it is.

[Suff]

Meanwhile a friend of mine tells me that IR35 has had an impact on contract HGV drivers.

It has increased their costs by 25% for work which carries a 2% profit margin.

Hauliers are already on razor thin margins, agencies are down to 2%, drivers would have to carry the full 25% additional cost.

Seems they're not keen. Surprise me some more. I love it when the worm turns.

[Workingman]

Been there, done that.

In the old days it was (very) beneficial to the client (a leading multinational) me and my intermediary.

Under IR35 it would still be beneficial to us all, though not at the same level, but still streets better than those on PAYE.

Whilst I have some sympathy, there are not bucketloads of it. Sorry.

Companies and individuals have had years to prepare for this.

[Suff]

What, prepare for losing up to 38% of your disposable income for no other reason than the government thinks that people who make their own way in life, take all the risks, pay to own and run their own companies, should pay the same tax as someone who won't do any of that.

Oh I can see the nice big cash pile that governments think they see. But it isn't there. Brown proved that the first time he implemented it. All he did was suck in loads of resources from Eastern Europe and Asia as UK resources said "stuff that, you're on your own".

This may have seemed like a good idea when we had an oversupply of resources and easy access to more. Now we have a tight labour market, resources are saying "What you want 38% of my money for _nothing_, take a hike". Prices are rising, companies are feeling the pressure and you know who is going to pay for it? Those who choose to have no choice in their lives.

Honestly, if this HGV crisis is being caused, in any way, by IR35; long may it continue.

Contractors do the jobs that companies can't find the staff for and don't want to pay to train them for. For example what I'm doing now won't be done again for a decade. Pay for your permies to do this and they'll either be deskilled or gone by the next time.

Yet, the government and the Banks and the Pharma want all our skills, to cut our pay and force us to take all the risks and be funnelled into a high tax/cost scenario.

'kem.

[Workingman]

You will lose, but others will step in for less when you leave. You know that they will, your work is available to all - if they have the skills, and many do.

There is a dichotomy here. Making physical 'things' needs a fixed location, a factory, It's costly to build and needs to be there for the life of the product and is useless for anything else.

Doing digital 'things' needs an office - anywhere. These people are out there and I know a few.

[Suff]

They are out there.

But if you look at what has been done with IR35, even if an Indian resource, working in India, takes the job, they have to go Umbrella and pay 62% of their wage out.

Even the Indians are covering these jobs with barge pole marks. They will get Every Single Thing they deserve when they wind up paying 3x for the job just so they can avoid the cost and effort of correctly assessing the work to be done.

I have worked with a significant number of people now who swear they won't work on an IR35 inside role again. No shortage of jobs, not pressure to take them. Nothing serious, just senior security architects and PM's who won't work for the companies.

Now what was it that was happening during the lockdowns again? Oh, yes, security breaches with potential millions in fines.

Sympathy sits between shit and syphilis in the dictionary. And that is right where they sit right now, without the comfort of a bit of sympathy.