Contractors Group IPSE
It seems that contractors group IPSE are in a bit of a crisis according to this contractor who is currently a member.
The fact that their definition of a contractors in business on his, or her, own account almost matches the Government and HMRC position, doesn’t count.
It may even exclude most of the members they purport to represent.
Anyway, here is what one contractor has to say.
IPSE At an End as an Organisation
I believe IPSE’s days are over.
At the moment, I currently pay my IPSE subs yearly partly to provide defence against an HMRC investigation or other losses.
I get my contracts negotiated and working practices reviewed, so should never need them,. However, I have the kind of luck that deems I will be that one in a million.
However, in a year or two’s time, when this government decides all contractors are inside IR35 by default, and contractor clients are so risk averse they will only employ contractors as temps on zero hour contracts similar to a warehouse stock picker at an internet retail company, what use will we have for them then?
Providing Historical IR35 Defence
I will pay my subs for another 3 or 4 years to provide historical defence and then that’s it.
No more IPSE membership.
What’s the point?
Should I carry on paying £300 / year just so I can get 4% off at Sainsburys – or a slightly discounted Dell laptop? They’re not one of the more desirable ones, either.
Nope – IPSE has a few years of life left to it, then I suspect membership will fall off a cliff.
There will be no more point in being a member.
And it’s IPSE’s own fault for being so ineffective, naive (to government “promises”) and having a romantic idea of contractors.
IT Contractor Comment
The Matthew Taylor Report, commissioned by Prime Minister May and Chancellor Hammond, will come out in June.
From Press Reports it seems that it will make the definition of self employment far more strict.
Already it would seem to most contractors it is strict enough.
Indeed, 40% of those in the private sector, who previously operated using personal service companies, are now defined as inside IR35 by HMRC’s new online IR35 Employment Status test.
So, what are contractors group IPSE going to tell Matthew Taylor as regards their contractor members?
IPSE Demands on Government Over Self Employment
IPSE are demanding that the Government, via the Matthew Taylor report’s definition of self employment should base self employment around the following:-
- Having autonomy in their work. For freelancers this means the ability to send substitutes and for there to be no requirement to do work outside what is agreed
- Having control over working arrangements. Self-employed people are able to decide how to complete their tasks and the hours and location they choose to work in
- Taking on business risk. Self-employed take responsibility for their finance and tax responsibilities and can be paid on a per task basis
- Level of independence from clients. This would include things such as having to wear a uniform or using your own tools and equipment to complete your work.
IPSE’s Self Employment Definition Excludes Most Contractors
This will exclude the great majority of contractors who work on projects on a freelance basis.
It will probably exclude the majority of IPSE’s members.
Most contractors are not able to send substitutes. This is a crazy rule anyway.
Most contractors get instructions on what tasks to do, and where and when they should do them.
Most contractors don’t earn money on a task basis but for a set period like three months or six months.
Also, most contractors don’t use their own tools and equipment to do their work. The vast majority of them don’t own a vast networked computer.
Who’s Side are IPSE On?
Yet contractors group IPSE are telling the Government that they agree with them that these contractors are not in proper self employment. They are basically saying that these contractors are disguised employees.
That’s despite many of them operating for years as contractors – and paying contractors group IPSE’s membership fees.
It seems that some IPSE members are more equal than others.
They appear to take a Basil Fawlty type attitude to some of their ‘guests’ i.e. those they used to deride as ‘bums on seats’ contractors. Although they don’t turn down their membership fees.
Shouldn’t representative trade bodies represent their members – all of them?
You wouldn’t find trade unions, like Unite, throwing their members to the wolves.
It’s easy to avoid defeat by the Government if you more or less take their line on what a contractor is.
Is Contractors Group IPSE Finished?
Is IPSE finished as an organisation?
It’s hard for me to say as I am not as close as this reader is to them.
However, if they continue to lobby on behalf of only some of their members and take a similar line to the Government and HMRC on which contractors are really self-employed, you wouldn’t expect those members excluded to continue to pay their membership fees.
40% of contractors in the public sector, who previously used limited companies, are no longer considered contractors for tax purposes.
The figure is 95% to 100% at HMRC for their contractors.
Private Sector Contractors
If the same thing happens in the public sector next year, as some analysts predict, this will decimate the private sector too.
And then IPSE will be mainly just insurance salesmen for a smaller and smaller bunch of what they would call real contractors.
It’s about time they get their fingers out and start fighting for all of those members of theirs who currently operate through personal service companies.
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