The HGV issue will ‘spread to other sectors’ if IR35 reform is not addressed, Brinkwire reports.
At present in the UK drivers for HGVs (heavy goods vehicles) are in seriously short supply and the shortage is affecting fuel and food supplies across the country.
While there are several possible causes contributing to driver scarcity, IR35 tax reforms have reportedly been recognised as a major factor and businesses have been asked to reconsider their contracting practices, especially as more industries are expected to be affected.
There is a shortage of roughly 100,000 HGV drivers in the UK, and while some blame has been attributed to Brexit and driver retirement, experts warn that IR35 legislation is having a significant impact on the economy.
Qdos - the IR35 specialist - told Brinkwire that if firms are to survive this challenging moment, they must rethink their “risk-averse strategy” to withstand these tax changes, arguing that doing so is “the key” to being able to attract flexible personnel.
Employment costs and risks shifted when the IR35 legislation was implemented in April. The responsibility for monitoring one’s tax responsibilities moved from workers (in this example, contractors and self-employed individuals) to the end client.
According to Qdos, the liability was also passed to “whatever party is responsible for paying the worker,”, often end clients or recruitment agencies.
As a result, some businesses have made the decision to require all contractors to be on the payroll, forcing many legitimately self-employed persons to either become employees or work “within IR35,” where they are taxed as employees but do not have any employment rights.
Qdos said that the misrepresentation of IR35 status and employers’ risk-averse approach to change has played a significant role in the UK’s current HGV driver shortage, with many drivers now having little choice but to work on the payroll of the companies who hire them.
Seb Maley - the CEO of Qdos - has proposed that organisations could at least partially manage their way out of the issue if they were prepared to rethink their employment processes.
“This is the first high-profile example of what not to do when it comes to IR35 reform and its far-reaching economic consequences,” he said.
“Too many enterprises that used to hire contract HGV drivers as self-employed employees have given them an ultimatum: work on the payroll or risk losing their job. This has resulted in a driving exodus.
“Leave genuine self-employed folks with little choice.”
Source: Brinkwire
The HGV issue will ‘spread to other sectors’ if IR35 reform is not addressed, Brinkwire reports.
At present in the UK drivers for HGVs (heavy goods vehicles) are in seriously short supply and the shortage is affecting fuel and food supplies across the country.
While there are several possible causes contributing to driver scarcity, IR35 tax reforms have reportedly been recognised as a major factor and businesses have been asked to reconsider their contracting practices, especially as more industries are expected to be affected.
There is a shortage of roughly 100,000 HGV drivers in the UK, and while some blame has been attributed to Brexit and driver retirement, experts warn that IR35 legislation is having a significant impact on the economy.
Qdos - the IR35 specialist - told Brinkwire that if firms are to survive this challenging moment, they must rethink their “risk-averse strategy” to withstand these tax changes, arguing that doing so is “the key” to being able to attract flexible personnel.
Employment costs and risks shifted when the IR35 legislation was implemented in April. The responsibility for monitoring one’s tax responsibilities moved from workers (in this example, contractors and self-employed individuals) to the end client.
According to Qdos, the liability was also passed to “whatever party is responsible for paying the worker,”, often end clients or recruitment agencies.
As a result, some businesses have made the decision to require all contractors to be on the payroll, forcing many legitimately self-employed persons to either become employees or work “within IR35,” where they are taxed as employees but do not have any employment rights.
Qdos said that the misrepresentation of IR35 status and employers’ risk-averse approach to change has played a significant role in the UK’s current HGV driver shortage, with many drivers now having little choice but to work on the payroll of the companies who hire them.
Seb Maley - the CEO of Qdos - has proposed that organisations could at least partially manage their way out of the issue if they were prepared to rethink their employment processes.
“This is the first high-profile example of what not to do when it comes to IR35 reform and its far-reaching economic consequences,” he said.
“Too many enterprises that used to hire contract HGV drivers as self-employed employees have given them an ultimatum: work on the payroll or risk losing their job. This has resulted in a driving exodus.
“Leave genuine self-employed folks with little choice.”
Source: Brinkwire