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Are we entering a new era of professional contracting services?
The new travel and subsistence legislation, which came into force on 6th April, is the most influential change to hit our sector to date. There may never be any further legislation that affects the industry in the way this will.
We are witnessing the beginning of a new era in contracting.
Yes, we’ve been through ‘seismic’ shifts before. In fact, over the last ten years, we’ve experienced nothing but change – AWR, reporting requirements, minimum wage, false self-employment legislation and so on.
But things are different this time around. With this legislation, alongside predicted tightening of the rules surrounding IR35 and PSCs and a change in liability arrangements, we believe a new, more professional age of contracting services has begun.
Gone are the days when commercial considerations were an agency’s top priority. Plus, an agency can no longer dictate how a worker is paid or not carry any liability for high risk tactics.
There are no more grey areas. Choosing a payroll provider will come down to black-and-white considerations of:
- risk and compliance
- worker benefits
- commercial factors
In that order. Here’s why.
- Agencies now need to establish where the risk lies and carry out due diligence and regulation audits. They need to cover themselves against risk and liabilities, such as debt transfer. They have to be, in other words, squeaky-clean. They need, therefore, to ensure their providers are too.
- The contractor is fast becoming king. As skill shortages bite, an agency’s ability to retain skilled workers will be key to its success, even its survival. With workers losing their tax-free expenses, how can agencies and payroll providers adapt their offer to continue to be attractive to these workers?
- In light of the above, commercial incentives, important as they are, can no longer be an agency’s priority.
- Agencies need to choose an option that is sustainable in the long-term.
So how should we approach this change? Through gritted teeth?
Here at Payme, alongside our sister company Falcon Accountancy Services, we’re embracing this brave new world. It’s high time we all focussed on what should be at the heart of our industry – the worker. Making sure they get the best possible return. Legitimately. That way, we all win.