Prime Minister trying to put an end to the contracting profession

Self employment is a market that is severely at risk. Not only is automation gradually chipping away at the contract profession, but several lawmakers are aiming to abolish it.

Most recently, PM Theresa May noted for her extremely conservative views, has taken action against the profession. In fact, in a statement released to Times news, she claimed that she intends to eliminate all contracting jobs by June. In a quick reaction, Matthew Taylor gathered all known legislative on contractors and contracting in an effort to stop May’s moves.

In the proposed finance bill, the memorandum sought to increase national insurance for contractors. This would further protect the contractors, which is likely why that article of the proposal was stripped by May and other conservative politicians. Taylor was upset at the government for removing it, but will continuing his fight for contract workers regardless.

Of course, neither politician is wrong nor right, good or evil. In May’s defense, her move against the freelance industry is to protect permanent UK jobs rather than shift to a gig economy. This position is highlighted in the fact that the report prohibits a freelancer from taking a position with an employer that was formerly occupied by a permanent employee. Additionally, the report is cracking down on employers dictating their freelancers every move, with employers now having to release the exact details of their freelancers duties and tasks within or outside IR35.

On the other hand, Taylor argues that imposing restrictions on freelance work will only slow down the market economy. Temporary employment is a great opportunity for those looking for part time jobs, or just a quick strap of cash, and has very little to do with replacing permanent positions in companies.

Conservatives are mainly targeting the IT industry, where they claim the problems mostly persist. Moreover, they emphasize that this problem in the technology market is quickly moving into other areas of the economy as well. The reason why there are so many temporary positions in the IT market is because permanent workers often undertake tasks that are beyond their singular capabilities, causing them to need to hire a temporary helping hand. However, under May’s new provisions, this will no longer be allowed, as temporary workers in the IT industry are often degraded as “bum on seat workers.”

Both politicians are working hard to compromise. It is expected that by June, Taylor’s final report will be delivered to May. Even though it is yet to be released, the gist of the document is that companies are manipulating legislation by hiring temporary workers for positions that should be filled with permanent workers in order to avoid paying corporate benefits, such as medical insurance, retirement, pension, and more. Nevertheless, Taylor urges May to fix these issues by addressing the companies directly, not by introducing legislation that hurts freelancers as a whole.

Limited Company Contractor are an advisory service for Limited Companies, aiming to take the hard work out of running your own company whilst you retain all the benefits. For further information, contact one of our team on 020 3823 9499 or [email protected] and we will be pleased to help.