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One in five workers concerned about the impact of IR35 changes

Upcoming changes to the off-payroll working rules – otherwise known as IR35 – are causing concern amongst employees, according to research, sparking worries about how freelancing and temping opportunities will be affected. A fifth (20%) of employees questioned in the study by Tiger Recruitment, including a third (32%) of those in temporary positions, and 36% of virtual workers, say they are worried about the updated legislation, due to be introduced on the 6th April 2020.

The new IR35 rules will shift the responsibility for defining the tax status of contractors from the individual to the employer, to crack down on so-called ‘disguised employment’, where off-payroll workers are able to pay less tax than payrolled employees. However, concerns have been raised that the rules could force organisations to bring genuine contractors and freelancers on to the payroll, reducing flexibility for both parties.

Apprehension about the changes are greatest among employees in the automotive (36%), energy, gas and renewables (35%), transport and logistics (33%) and IT (31%) sectors, which are all heavy users of contract workers. Those in banking and capital markets (26%) and education (26%) are also more concerned than workers in other sectors about how they will be affected by the new rules.

“Contractors, freelancers and temps play a vital role in the workplace, giving employers access to quality talent for short-term resourcing needs, while offering individuals a level of freedom and flexibility that can’t be found in a traditional role,” comments David Morel, CEO of Tiger Recruitment. “While the upcoming changes are designed to crack down on those who are abusing the system, the Government must be careful that in doing so, they don’t throw the baby out with the bathwater by reducing workplace flexibility in the process. Meanwhile, employers must ensure they are adequately prepared, so that they can continue to take advantage of flexible talent, without the risk of facing bills for outstanding taxes and additional penalties.”

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