The last fortnight has seen most political parties commit to reviewing the off-payroll reforms due in 2020 followed by some confusion as to the substance of their commitment, and then some attempts to backtrack. Cold comfort then for those contractors who are being affected by their clients deciding to discontinue engaging them via their PSCs, instead their contracts are being terminated in favour of a payroll-based engagement at the same overall assignment rate, i.e. without the usual uplift for employers NICs and overheads.  So a double whammy as these contractors are effectively funding the employers NICs as well as the employees deductions.  The contractors have a stark choice; either accept what is on offer along with the significantly reduced income, or don’t. 

Most contractors I have been talking to will certainly be in touch with whoever their newly elected MP is quick-smart with a view to stopping the next year’s changes.  Surely they can’t ignore the very real impact the off-payroll changes are already having on many hardworking individuals?  HMRC has often been quoted as saying that the changes should not affect those that are genuinely self-employed, however this is simply not the case in reality.  And of course, we are yet to see the full scale of the inevitable increase in tax avoidance schemes that will aggressively target and exploit these workers whose income is reduced. 

Whatever the shape of the new Government, you can be assured that FCSA will be actively lobbying for a delay to the off-payroll changes – particularly as we are seeing the unintended consequences happening right now, unfortunately as we predicted. 

This is our last newsletter for 2019 (as the next one would be due on Christmas day!) so I wish you all a wonderful festive break, and I look forward to working with you in 2020.

Best wishes

Julia Kermode, FCSA Chief Executive


In this Issue

News | Government, Policy & Technical | Legal Update | Market Analysis | Media Coverage | Upcoming Events | Directory of Accredited Members


UK workers are happy with their contracts – even in the gig economy

According to latest ONS figures, almost all employees (99%) have a “desired contract” - either a permanent contract or non-permanent contract for a reason other than “could not find a permanent job”.  This contradicts the perception that temporary contracts, the gig economy and zero hours contracts are exploitative.  Less than 3% of the UK’s workforce are in zero hours contracts, of whom 57.6% do not want more hours.  The research also found that 13% of UK workers do more than 48 hours per week, whilst 7% are underemployed, with the remaining 80% working “satisfactory hours”.


Latest figures show disability pay gap of 12.2%

Disabled employees are paid 12.2% less than their non-disabled colleagues, according to the Office for National Statistics.  This pay gap has narrowed slightly, down from 12.7% in 2017.  The data shows that the median pay for non-disabled workers in 2018 was £12.11 an hour, compared with £10.63 for those with disabilities.  This is most defined in London, where the pay gap is 15.3%, by comparison in Scotland it is 8.3%.  The pay gap between disabled workers and non-disabled staff also varied with age.  It was widest for those in their 30s and 40s, the ONS found, hitting 18.7% in the 30 to 34 age range.  Disabled people were more likely to be self-employed than non-disabled people, at 15.2% and 13.9% respectively.


KPMG & REC latest report on jobs

UK labour market conditions remained challenging in November according to the latest KPMG and REC “Report on Jobs” publication.  Recruitment consultancies signalled a further reduction in the number of people placed into permanent positions, while temp billings rose only slightly. Subdued hiring trends were widely linked to uncertainty surrounding the upcoming election and Brexit, which had reportedly led to many clients to delay or cancel hiring plans.  Key findings reported were:

  • Permanent placements fell for the 9th consecutive month in November 2019;
  • November saw the slowest increase in overall vacancies for over a decade;
  • Permanent starting salaries increased at the slowest rate since December 2016, while temp wage inflation eased to a three-year low.

Recruiters widely commented that people were becoming increasingly reluctant to seek new roles due to uncertainty around the upcoming election and Brexit. Overall, candidate numbers fell at the quickest rate for five months, with permanent staff supply declining at a sharper pace than that seen for temp workers.

Government, Policy & Technical

HMRC hits target of 5 minutes call waiting time

HMRC received 3.17m phone calls in October, down from 3.65m the previous month, and managed to improve the average speed of answering a call.  The average speed of answering a call was five minutes, an improvement on the average response time for the first nine months of 2019, where on average it was taking seven minutes and 18 seconds to answer calls.  The department target time for call answering is five minutes.  However, the five-minutes is the waiting time for the call to be answered and put through the automated answering system, not the length of time a person waits to be dealt with by a tax official.


MTD: scheduled maintenance

There will shortly be some scheduled maintenance on the Making Tax Digital service for income tax.   Customers will be unable to use the MTD Income Tax service from 4:30pm on Friday 13 December until 5pm on Monday 16 December.  During this period, customers will be unable to:

• Sign up to MTD for Income Tax
• Submit updates
• Access their MTD Income Tax viewer in the Business Tax Account

After the scheduled maintenance has concluded the service will allow businesses and agents to provide information about a brought forward loss and make loss claims.

Customers will also be unable to use the MTD VAT service for a short period from midnight until 2am on Sunday 15th December.

Brabners LLP Legal Update


Are ‘workers’ covered by TUPE protection?

Brabners take a look at at new employment case that explores this issue and discusses what this means for employers and recruiters.

Find out more >

Market Analysis

Vacancy numbers fall or stall in all major industries apart from Health

At 800,000, the average number of official job vacancies recorded across August - October 2019 was 53k (6.2%) fewer than the same period last year, and 18k (2.2%) fewer than in the previous quarter (May - July 2019). This is the fifth successive rolling quarter where numbers were lower both year-on-year and quarter-on-quarter.

Moreover, in all but one major industry (Human Health & Social Care), numbers were down or remained static year-on-year. This included a 21% (8k) fall in the number of opportunities in Transport & Storage, a 17% (10k) fall in job openings in Manufacturing and a 17% (6k) decline in open roles in Finance & Insurance.

Media Coverage

Financial Times
Main parties pleade to review IR35 reforms after election

Read Article >

Government to name and shame head of supply chains for poor employment practices
Read Article >

Working Mums
Take time now on IR35 or you could lose out later, employers warned
Read Article >

Information Matters

Advice for contractors choosing an umbrella
Read Article >

Over half of self-employed don’t even know what IR35 is
Read Article >

Freelance body rubbishes new CEST for omitting Mutuality
Read Article >

Upcoming Events


Recruitment Agency Expo
4th & 5th February 2020
Olympia London

FCSA will once again be exhibiting at the Recruitment Agency Expo in London.

Recruitment Agency Expo is the UK’s biggest event for recruiters featuring a cutting-edge exposition of more than 100 vendors exhibiting the latest tools, technologies and services, and an educational program that brings together 50 leading experts with an audience of over 3,000 senior level staffing professionals. Together, the expo and conference create the most valuable B2B networking platform for the recruitment industry.

For more information about this event and details of how to register for free, please visit the event website >

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