While understanding and endorsing many of the interpretations and suppositions presented by Kevin Barrow (’Recruiters warned about persuading temps to become PSC contractors’, 5 May), there is a danger of agencies running their businesses narrowly determined by unsubstantiated future constraints rather than openly benefiting from what the law allows. My concern embraces Kevin’s direction regarding IR35.
In my view as a regulated tax advisor highly experienced in the contracting market, the following are indisputable:

1. A contractor grossing annual assignment income above £45,000 will always be financially better off by operating through a PSC whether or not the annual work is in or out of IR35.

2. While no agency should risk MSC ’third-party debt’ issues by actively encouraging their PAYE temps or umbrella workers to switch to operating through their own PSCs, there is no legal issue facing an agency that encourages its contractors to seek regulated advice from chartered or certified tax advisors as to the benefits and disadvantages of alternative ways to contract.

3. Only by meeting face-to-face with a regulated advisor (not over the telephone with an unregulated ’client advisor’ on a ’help desk’), can the contractor be presented with all relevant, legal options one of which will provide the highest, legally achievable, net income retention (one of many reasons for choosing which way to contract). It is then for the contractor to choose before advising their agency of the outcome stay as is or operate through their own PSC.

4. It is the contractor who is legally obliged to assess whether each contract is inside or outside IR35. It is the contractor or their PSC which becomes accountable for any tax arising not the agency!

Michael Linden, senior partner, Nyman Linden Chartered Accountants

Not all ’red tape’ is bad…
In response to your article ’Red Tape challenge website will boost SMEs, says Longman’ (recruiter.co.uk, 11 April), not all regulation is bad regulation. The recent Equality Act is an essential piece of legislation that needs to be safeguarded and should not be ’scrapped altogether’, as the Red Tape website asks.

However, this presents us with an opportunity to influence which rights employees should and should not enjoy and streamline existing regulations so as to reduce the already excessive workload recruiters have to bear. AWR and the pensions reform will invariably add to this workload while existing policies on procurement and the ever-changing tax rules which effectively restrict the movement of talent, could all benefit from a relaxation in legislation.

Darren Browne, chairman, Nurture People (formerly known as Connect Group)

… but it is in healthcare

The UK is literally swamped with overbearing workplace laws, and none more so than in the healthcare sector (’Red Tape challenge website will boost SMEs, says Longman’, recruiter.co.uk, 11 April).

Take the CRB checking process as a primary example. Despite becoming more simplified it remains weighted in favour of permanent workers whose fees are paid for by their employer, while locum workers and other temporary staff must pay out of their own pockets or as is often the case, the recruitment agency covers the cost.

A predictable, regulated environment makes job creation easier.

However, with seven major new pieces of employment legislation earmarked for this year, including removing the default retirement age and additional paternity leave, this will add to the increasing costs of doing business in Britain and undermine the ability of organisations to recruit additional staff.

Andrei Shelton, managing director, BritishMedicalJobs