IT Contractors Purged

The Court of Appeal's judgment in the case of Cable & Wireless v Muscat has far-reaching consequences for long-term IT contractors and the economy of the City, where several banks, financial institutions and corporations engage freelance IT contractors for specific projects.

The Professional Contractors Group (PCG) is worried over the force of uncertainty and misinformation at work, which may lead to the UK missing out on one of its greatest competitive advantages.

PCG's policy officer John Kell said, ""We are suddenly hearing reports about IT contracts being terminated early, simply because client HR and procurement departments are afraid of being deluged with claims for employment rights.”
 

Drawing attention to the fact that “the absurd situation where employment status and tax status operate independently of one another”, he said IT contractor also get taxed as an employee, even when they do not have, and do not want, full employment rights.
 

“We believe that genuine freelance contractors should be able to enter into bona fide business-to-business contracts with their clients, either directly or through an agency, without any of the parties fearing that the relationship might be viewed as one of employment” he said.
 

Uncertainty

Kell made it clear that the situation leaves a lot to be desired and the Government must acknowledge and address this problem. “Continued uncertainty will be detrimental to an economy that thrives on the flexibility and skills offered by the UK's freelance workforce,” he said.