* Posts by colettewyattCTO

1 post • joined 16 Nov 2019

20% of UK businesses would rather axe their contractors than deal with IR35 – survey


In the comments people seem to not understand why companies use contractors in the first place

1. Companies do not need to pay Employers NI, provide a pension, healthcare, or other benefits to a contractor.

2. Contractors can be released from their contract very easily.

3. Contractors are not included in Headcount, therefore, if the company has a "recruitment freeze" they can still use contractors.

4. In an IT Team I can swap out resources as and when I need them, so today I need a developer to work on a new native mobile app, and next month I need a developer to work on a web based app.

5. Contractors are not cheap, but neither are they necessarily more expensive, but when you now add to the already higher day rate: the NI, pension, healthcare and other benefits to a contractor your costs have just increased by 20-30% per contractor, that is difficult to swallow.

6. As with employees you get good contractors and bad contractors.

7. But what is the answer? The only options are to hire permanent resources or offshore, so, businesses need to make a commercial decision - can they afford a further 20-30% increase in costs? Or do they need to offshore and make 20-30% in savings. If it's a pure business decision which would you make?

8. Also from a contractors perspective, accept the drop in pay, get the benefits but choose wisely, because you are not going to be able to just jump from one contract to another in future - you need to find a good cultural fit.


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