Posts Tagged ‘agencies’

There have long been debates and doubts about the role and responsibilities of a professional contractor, particularly in the eyes of HMRC. Now, independent professional membership association Professional Passport has announced plans to produce a formal definition of a professional contractor. This will concentrate on career professionals as opposed to those who come into contracting on a short-term basis, possibly only until they find a permanent post.

The organisation believes such a definition will benefit all involved parties. Contractors could be removed from tax and employment legislation such as IR35, the Agency Workers Directive and income shifting rules. It will enable the government to simplify existing legislation and reduce the need for future legislation while presenting no threat to tax revenue. Agencies and employers should also benefit from reduced bureaucracy and the removal of threats of employment rights actions or tribunals.

The Service Providers Association welcomed the proposals, having previously launched its own code of conduct for businesses in the service providers’ sector. This is designed to encourage best practice in the industry and to demonstrate ethical operating practices so that contractors will know they are dealing with professional organisations.

The proposed definition may clarify contractors’ employment status, which has been called into question by the case of Tilson versus Alstom Transport. The original outcome of this case was that the contractor who brought a case for unfair dismissal was awarded employment rights on the grounds that the contract between the parties was invalid. This decision was subsequently overturned on appeal and the claimant was adjudged to be a contractor rather than an employee.

This case yet again illustrates the sometimes complex relationship between contractors, agencies and employers, emphasising the need to have a proper working structure. Contact UKContracting.net to get your affairs in order.

Popular opinion has long been that there’s a love-hate relationship between contractors and agencies, which probably varies with need. However, new research from online recruitment marketplace TalentPuzzle suggests that agencies aren’t that popular with employers either.

There is an acceptance that agencies have a useful role to play, especially since they help to fill specialist positions and often provide better candidates than would otherwise be obtained. However, there is obvious frustration that the briefing of agencies on requirements often appears to serve no useful purpose. Despite outlining what is needed, CVs are often submitted from unsuitable candidates and the capabilities of applicants are frequently overstated. Agencies that pester for feedback on candidates and CVs are also a source of annoyance.

Unsurprisingly, the fees charged by agencies are a considerable bone of contention. Not only are they thought to be excessive in many cases but there is a strong feeling that rates need to be more consistent across the different agencies. The situation isn’t helped by a perceived lack of transparency, which can leave employers with the feeling that they are paying more than they need to do for a particular candidate.

By working more closely with employers and being more open about their rates and methods, agencies can provide a service that is not only better but, more importantly, is seen to be better. An improved service at a price that is accepted as fair will lead to a better working relationship and more business in the long term.

After several months of consultation with industry representatives, the government finally laid before parliament the regulations to implement in the UK the EU Agency Workers Directive. The timing is to make good the government’s pledge to get the regulations on the statute books during the current session of parliament. However, they do not come into force until October 2011, which will supposedly give all those affected the time to make preparations.

The Agency Workers Directive aims to protect temporary workers, who are deemed to be ‘vulnerable’, by granting them the same rights as full-time employees after they have worked for a company for twelve weeks. The consultation period has predictably seen the trades unions push for full protection while industry representatives have been arguing for light regulations. Although the latter generally welcome the delay in implementation, they are concerned that they have been unable to comment on the final regulations, which are considered to have many inconsistencies.

In particular, those who are classed as ‘genuinely self-employed’ are to be excluded from the regulations. This applies to those with limited companies but not contractors who operate through an umbrella company. Agencies do, understandably, welcome the decision not to impose restrictions on agency fees that are thought to be unreasonable. There is also the question of who will stand the £1 billion a year estimated cost of the regulations, with the suspicion that it is the contractors themselves who will ultimately be hit.

Industry representatives now seem prepared to wait and see the detail of the regulations before coming to any firm conclusions. They also appear intent on seeking clarification of points that concern them and working with the government on the guidance documents that determine how the requirements will be interpreted. However, these things tend to be difficult to stop or divert once they’re set in motion and even a change of government may make no difference.

Contact UKContracting.net to make sure you’ve got the most suitable working arrangement and limit any harmful effect of the Directive.

Being an IT contractor means that you move jobs fairly frequently and may work for many different managers. Some will be brilliant, most will be average and a few will be so dire that you’ll wonder how they got the job. The really incompetent managers do tend to have certain characteristics. If you can spot these at the interview, it might save you from taking a job you’ll regret later. Failing that, recognising the signs early might mean you can beat a hasty retreat before things get too far.

Good managers tend to be able to size up a situation and make the right decision quickly. Incompetent managers, on the other hand, are usually procrastinators and put off a decision as long as they can. They’ll hold meetings to discuss issues, consult endlessly and only make a decision if a deadline can’t be avoided and they’re pushed into a corner. Even then, it’s likely to be the wrong one and so tossing a coin would have served as well.

Poor managers tend to get bogged down in detail. They seem incapable of cutting through the dross to see what’s really important. As a result, they do everything by the book and produce reports and charts that are extremely detailed, accurate and perfect in every way. They just don’t necessarily have any useful function.

Because they pay such attention to detail and get immersed in routine tasks, incompetent managers generally work long hours. They seem to see it as a badge of honour to be there before all their staff and still be beavering away when everyone else has gone home. In reality, it simply reinforces the impression that they’re not up to the job and have to work longer in order to get things done — or not.

Whereas the best managers tend to operate openly and keep their staff fully informed of what’s going on, incompetent ones often adopt the mushroom management style. They harbour secrets in the belief that too much knowledge may upset, distract or confuse the poor workers. In reality, keeping people in the dark simply fosters rumours and distrust, resulting in insecurity and doubt among team members. This lack of confidence and belief also means that poor managers can’t deal with problems as they arise, which leads to indiscipline and poor team morale.

Some incompetent managers actually believe they do a good job whereas many know the truth. As a result, they’ll often hire the least able candidates for a job. They fear that taking on supremely talented staff will reflect badly on their abilities and feel less threatened by those they deem inferior. If you don’t get selected for a job, console yourself with the thought that you might have been too capable.

Good managers who change jobs often attract some staff to move with them. Incompetent managers never do because their staff are glad to see the back of them. If you finish up working for the wrong type of manager, read the signs quickly and get out before it’s too late.

With employment conditions remaining challenging, you need to make the most of every opportunity to ensure you have the best chance of getting that next contract. If your CV gets picked off the pile, that means making a good impression at the interview, whether it’s face-to-face or over the phone.

Having a good interview is to some degree down to the preparation you do before it. Find out as much as you can about the company and the post for which you’re being interviewed. Your agency should be able to provide much of this and there’s always the company website to get some background. The more you know about the company, its activities and aims, and the role you’ll be expected to undertake, the better prepared you’ll be.

Learning about the company and the job will allow you to plan what you might want to say. Those of you who have done a few interviews will be aware of the general style of questions that are likely to be asked. They want to know how you’ve operated previously, how you react to certain situations, your strengths and weaknesses. Often, they’re as interested in how you answer a question as the answer itself.

You can anticipate some of the questions and be prepared with some reasonable answers. In particular, have information about projects you’ve worked on that are relevant to the post for which you’re being interviewed — your role in the project, what it achieved, decisions you made and work you undertook that contributed to its success.

Turn up for the interview on time and don’t forget that first impressions count. If you’re not sure how to dress, the safest option is probably to over-dress rather than go the other way. The best way to act, if possible, is just to relax and be yourself. Trying to be someone you’re not is likely to come over as false and not go down well at all. Be confident without appearing cocky, talkative without being a motor mouth, keen but not actually begging for the job and friendly without coming over as the life and soul of the party.

Just act natural and give the information the interviewer wants. They’re first and foremost looking for someone who can do the job, which is where your preparation and project information comes in. They’ll also be after someone who is adaptable, can be relied on to do what they’re asked and will fit in with the rest of the team. It will also help if your rate meets the budget and you’re available when needed. However, if you tick all the other boxes, they might make a few allowances.

The more natural conversation you can have, the better the interview is likely to go. If you come over as a friendly person who knows what they’re talking about, have the experience they want and show interest in the company and the job, you’re a long way there. Do ask questions and, at the end of the interview, try to establish the situation and what happens next.

If you’ve been sent by an agency, the courteous thing to do is to let them know how the interview went. It’s also not a bad idea to send a thank you letter to the company. Even if you don’t get the job, it will leave you in a better position for the next one that’s on offer.

Having the right contacts can keep the job offers flowing while being organised will ensure you’re properly prepared. So get in touch with UKContracting.net to make sure you’ve got the right set-up for ongoing business.

As we slowly emerge from recession, the world is a different place on the other side. So you need to know how it’s changed and adapt to the new order if you’re going to take advantage of the opportunities.

Flexibility is the big emphasis and you need to be prepared to react. Money has been tight for some time and budgets have been kept firmly under control, which isn’t a situation that’s likely to change quickly. As a result, investment will be more closely focused, leading to companies concentrating on project-based assignments rather than long-term contracts. The result is you might have to be prepared to move around more often and so the next contract could be something you have to plan earlier.

Employers will be looking for value for money and so will want quick results that are easily measured. This will inevitably lead to a greater level of accountability and reporting through the course of a project. The quest for value may also result in more projects going offshore to get lower labour costs, although the need for high-quality work on complex developments may influence what is possible.

Cost savings may prompt firms to outsource larger segments of their business, especially non-core activities, which may open up more opportunities. As ever, having the right skills will help. In the brave new world of 2010, this is likely to involve anything concerned with the environment and sustainability, cloud computing, mobile applications, social media and banking, with the latter having to adjust to new regulations resulting from the financial crisis.

One change that’s nothing to do with the recession is the EU Agency Workers Directive that allows contractors to negotiate with employers directly once the initial contract ends. This lets you sort out any renewal without the agency being involved, providing you don’t opt out of the regulations.

While things are likely to be improving, they won’t be the same as before and you need to be prepared for the change. One way is to be sure you have the best business structure to operate efficiently, so contact UKContracting.net to get the best advice about this.

The consensus now seems to be that the worst of the downturn is over and things are starting to move upwards, even if slowly. After a year in which the number of IT contractors earning over £70,000 a year halved, it’s hardly surprising that people are looking forward a little uncertainly.

As has been noted previously, temporary job opportunities seem to be opening up quicker than those of permanent staff due to doubts in the market. The good news for contractors is that many people think that this is likely to be a long-term trend.

No less a body than the CBI believes that the experiences of the recession are causing companies to plan for a more flexible future. The thinking is that companies will have a smaller number of permanent employees and will supplement this core group with consultants and temporary staff to meet specific needs. This policy will allow them to adjust the size of their workforce quickly and easily as market conditions change.

The CBI does see problems for workers in terms of earning stability, pension funding and difficulties in getting loans and mortgages. It’s also true, of course, that getting more freelancers isn’t as easy as just turning on a tap, especially for those in high demand. However, the CBI’s opinion is that those willing to work flexibly without the security of permanent employment can reap the rewards.

A survey of 43,000 small companies by PeoplePerHour.com revealed that many have made significant savings by using freelancers and have increased their income as a result. A surprising 35% of those that took part said they had converted to home-based businesses through the use of freelance staff. However, PeoplePerHour does operate a freelance jobs website and therefore the companies that are registered there are hardly representative of UK businesses as a whole.

Nevertheless, for contractors with the right skills and a flexible attitude, the situation does seem to offer a bright future. Any move to using more temporary workers does mean, of course, that it’s up to the workers to ensure they have the correct skills because the employers won’t be providing the training. However, established IT contractors are well used to sorting out their own training and other administrative matters. At least those who use the services of UKContracting.net will operate under the most suitable business model and have more time to exploit a flexible market.

IT contractors will be familiar with IR35 legislation, which sets out to distinguish between freelance and permanent employees. However, a recent case before the Court of Appeal has brought the subject of employment status to a head once again.

Autoclenz, a Derbyshire-based car valeting firm, used 20 car valeters on a self-employed basis. However, an Employment Tribunal upheld the workers’ claim that they are employees, although the Employment Appeal Tribunal overturned this ruling but granted limited employment rights. Autoclenz appealed but the Court of Appeal decided the workers were actually employees.

The decision was based on a new contract that the workers had signed in 2007. Although the document referred to the workers as ‘sub-contractors’, it was found that the company controlled the workers and integrated them into its business. Crucially, the right to send a substitute to do the work, which was incorporated into the latest contract, was unknown to many of the workers and no-one had ever exercised this right.

Contractors who want to avoid falling within IR35 legislation must ensure that any contract they sign places them under no obligation to accept work and does not make them subject to the client’s control. They also need to be sure not only that the contract they have with the agency gives them the right to send a substitute but that the contract between the agency and the client also has a substitute clause. The absence of the latter, which means the client will not be aware of this right, may result in HMRC viewing the document as a contract of employment.

If you are a client of UKContracting.net, you will receive the best advice and your status will be clear. If not a client, get in touch.

Being an IT contractor might seem like a glamorous sort of life to the outsider — lots of money, varied work where and when you want it, technical knowledge and skills, respect from your peers and managers — the list just goes on. But from the inside it doesn’t look quite so rosy and you need a special kind of temperament to make a success of it.

Anyone thinking of taking up contracting needs to consider seriously the realities of the role before making the leap. Given the current economic situation, some people are almost falling into freelancing simply because their so-called permanent job has disappeared. But often they’re doing this only until the situation gets back to normal, when they’ll return to their comfortable full-time position. However, if you’re going into contracting for the long haul, you need a totally different attitude to the job.

First of all, it’s important to get the truth about the money situation sorted out. Yes, you get paid considerably more for a contract position than for an equivalent permanent job. But, depending on your situation, you may have to pay not only income tax and employees’ NI out of this, but employers’ NI as well. You may also be working away, so you’ll have travel and other costs. Added to this, your agent takes a cut and you’ll probably have to pay an accountant and other expenses, such as insurance, health cover and pension contributions. And, most importantly, you only get paid when you work — you don’t get paid when you’re ‘resting’ between contracts, ill or on holiday, nor for the extra administration tasks you have to do. I’m not saying you’ll be reduced to poverty but it does rather bring down the average.

Working freelance brings with it a degree of uncertainty. While working on a contract, you always need to look to the future to see where the next job’s coming from, whether it’s renewing your current contract or finding another one. When times are hard and money is tight, contractors are always the easiest ones to get rid of so you have to watch for the signs.

To ensure a continuity of work, you need to build up a reputation as a good, reliable and effective worker. Get some good projects on your CV and make sure you do what’s asked of you without complaining. If possible, try to specialise in something that’s currently in demand because, that way, you’ll get a constant stream of work at a high rate. This means that you need to gain experience and possibly get some training, which you’ll probably have to pay for yourself.

As a freelancer, you’ll generally find that you’re treated differently to the permanent staff. Some people may look upon you as a highly skilled expert while others consider you an overpaid opportunist who can’t be trusted. As a result, you may not be involved in any decision making. You may also find that the permanent employees get the best and most interesting jobs while you get all the drudgery. If so, you need to knuckle down, get it done and prove you’re capable of better things. Just accept the fact that, because you’re an outsider, you’re expected to work longer, harder ad produce better results than everyone else from day one.

Of course, it’s not all doom and gloom. Contracting is a lifestyle choice and has many advantages over permanent employment. Aside from the extra money, it offers flexibility. In the good times, you can pick the projects that appear interesting and which offer opportunities to gain experience where you want it.

If things don’t work out, you can move on to another contract. Unlike permanent employees, where frequent job changes are viewed with suspicion, you can switch employment frequently because it’s just part of the arrangement. Moving around frequently does have its advantages — new people to meet, fresh challenges to face, avoidance of office politics and no worries about company restructuring or a change of management.

Contracting does offer a lot of advantages. You just need to be aware of what you’re letting yourself in for and the possible drawbacks. If you’re flexible in your approach and adopt the right mind-set, there are plenty opportunities for those with the required skills.

With the economy in disarray and unemployment rising, it’s hardly surprising that the contractor market has been badly hit. After all, if employers need to cut costs, they’re likely to get rid of temporary workers before laying off permanent staff.

Contractors have been hit in two ways — firstly by the reduction in posts available and secondly by lower rates being offered for those jobs that do exist. Those negotiating a contract extension or a new contract have generally found that rates are significantly down on previous years. One reason for this, of course, is simply supply and demand, with employers well aware that there are plenty of candidates for every vacancy. Another is that some agencies are trying to increase their margins in an effort to bolster income that has been reduced by fewer jobs being available.

Latest figures show that, after demand for IT contractors had fallen for six successive quarters, things are starting to pick up. The decline had begun to flatten out and the latest Monster Employment Index showed demand for IT workers rising by 3 percent. Marketing and sales professionals showed a 6 percent rise but telecomms, construction and engineering have marked declines.

There were also variations between industries, with public sector demand down but the financial sector showing signs of recovery. The Experian Insolvency and Distress Index recorded 1796 business failures in September 2009, with 3.3 percent being IT firms and 14.8 percent in construction. Demand for certain skills has declined less than others, demonstrating the need for contractors to keep their skills up-to-date and relevant.

There are some indications that the worst may be over and, with confidence on the increase, demand may be starting to return. However, some economists have expressed fears of a double dip or W-shaped recession, where demand falls for a second time before the real recovery gets underway. Nevertheless, although contractors are often the first to go because they are the easiest to get rid of, they are also taken back on quickest since they have the required skills and flexibility.