Your subbies are lawfully self-employed

Your subbies are lawfully self-employed

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One of my construction client has received a mail shot ( from A self emplyment facilitator comapny = XYZ Ltd) with a caption " Your Subcontractors are Lawfully Self-employed".

Other phrases included are:-

It says tp Appoint them (i.e. XYZ Ltd), and you eliminate the status issues for your company"

What this means is for your comapany, is that any opeartive can be self employed on your sites on payment terms that you determine.

It also says that there is no contractual link between contractor ( my client) and the operative.

I was weondering has any of the readers come across any such companies, or any of your contactor clients dealt with such " self-employment facilitator companies?

Thank you for your valuable comments and time in advance.

Shortland Shortlanda

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By NeilW
23rd Mar 2006 19:51

Composite Companies
These things litter the IT industry and I'm surprised that construction has been so slow to catch up.

Essentially if there is a crack down on self-employment, then prime contractors will insist on retaining Ltd Companies, and if the employment agents get involved then it will be Ltd Companies via the employment agent.

The Ltd company that wraps the individual can either be one of their own or a 'composite company'. All of these are ways of avoiding employment right issues and pushing the taxation problem onto the shoulders of the individual.

P.S. The government doesn't like composites.

NeilW

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By Elenderil
24th Mar 2006 17:29

I know of a couple of these
I have come across Team Construction Limited and Hudson Contract services Limited. While I haven't seen either of these company's arrangements challenged by a Status Inspector. Hudson's were the subject of a special Commissioner's decision a few months ago and I seem to recall that the commissioners seemed satisfied that these types of arrangements, when properly implemented, do work.

I am also aware of a short quote in the main budget report stating that the government are going to take a look at "disguised employment through managed service company schemes". So we need to keep our eyes on developments in this area. Sorry but I don't know where in the reports the quote comes from as I received it from a colleague.

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