Industry responds to HMRC’s T&S proposal

When the government first published the discussion document ‘Employment Intermediaries: Temporary workers – relief for travel and subsistence expenses’ last December, it perhaps didn’t bank on the subsequent industry reaction.

Targeting the so-called misuse of over-arching contracts of employment (OAC), HMRC’s document suggested that umbrella workers claiming travel and subsistence expenses (T&S), while working at temporary worksites under an OAC, is unfair. HMRC suggested that £400 million was being lost due to such claims.

While it presents yet another disruptive proposal that recruiters have to grapple with, on a positive note, the route the government chose did welcome comments on their plans from across the industry.

What followed was a powerful, collective industry response that Anderson Group was heavily involved in, organised by the FCSA (The Freelancer & Contractor Services Association) and masterminded by EY. Designed to reveal some truths about the temporary worker sector by using concrete, statistical evidence gathered from 40 major umbrella companies, the response showed HMRC that a vast number of umbrella workers are not the stereotypical, very low paid and abused workforce that they believed them to be.

Such significant and weighty responses are what the industry as a whole should practice more of. The pulling together as a community, so we can present a stronger, more professional voice and engage with the government to help inform how the UK supplies its labour for the collective benefit of UK plc.

Since then, the government has stated within the Budget that their new measures would have even wider implications and also apply to PSCs (Personal Services Companies). The ensuing full consultation period will be one of ‘wait and see’, with many elements still to be clarified and hence more uncertainty for all involved.

This increasing pressure on the recruitment industry through yet more legislation, at a time when the economy remains buoyant, could run the risk of damaging growth. The UK’s approach to using flexible labour must not be checked harshly or this healthy outlook may well become destabilised.

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