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26th September 2008: Labour party conference and self employment
Reading over some of the online news sites (in this case Contract Journal specifically), I've happened across an interesting little piece of info from the recent Labour Party Conference. The key points I'll be discussing are these statments from the policy document that was handed out at the conference itself:
- "We have already acted to protect agency workers, but we recognise the damaging effects false self employment status can have and will work to eradicate false self- employment in construction."
- "We will put in place a series of measures to ensure that nobody is falsely classified as self-employed. These will include using procurement rules on all publicly-funded projects."
I would imagine that most of you would be pretty surprised that not only do you need protection from self employment, but that it's having a damaging effect on you. From what we've seen throughout the industry contractors are choosing to become self employed rather than become employees of agencies or even umbrella companies.
I'm sure the party's stance has nothing to do with a perceived loss of tax revenue.
Ucatt appear to be very happy about the whole thing claiming that it's the "most significant step forward in the industry in a generation." I couldn't say whether or not that is the case, but one of the real strengths of the UK employment market and one that has been cited as a potential defense against any recession is the flexibility of our workforce; you, the contractors and freelancers.
The Labour Party website itself claims one of Labours "Key achievements" is that "There are approximately 430,000 more VAT registered businesses now than in 1997, and 350,000 more self-employed people". [Edit: I've just been handed the Construction News in which it estimates that 400,000 self employed workers are "bogus" I think it's safe to assume that there are more of those than in 1997 as well.]
This may not all be a bad thing, the current rules used to decide if a person is self employed or an employee are pretty murky, speaking to a former inland revenue negotiator a week or so ago he explained that it can all be a matter of perspective, the contracts can take you so far, but a lot of it can come down to the situation at the site itself.
That's our take on things, and we'd really be very interested to hear your views. You can send emails to Hugo, let us know what you think.
Hugo
26/09/2008
