The group was formed in order to highlight the importance of the UK’s flexible workforce to the Government, as well as providing a way to pass on any recommendations to them. Their inaugural meeting involved discussion about the concepts of flexibility in the workplace versus flexible employment models.

Former Chief Executive of the British Chambers of Commerce, David Frost CBE, said it is an important time to be focusing on the flexible workforce, both for the country as a whole and for businesses on a smaller scale.

“The UK’s flexible labour market has long been acknowledged as a significant competitive advantage and a driver of investment and growth in this country. But with 2.6 million unemployed and the UK hovering close to a double-dip recession, it is more important than ever that we think critically about flexibility.”

“Employers are adopting a more flexible approach not only as a temporary retention strategy, but as a permanent and sustainable solution to more competitiveness.”

The REC’s Chief Executive Kevin Green also described the formation of the group, who will meet again on February 21st, as “a critical development in our work to champion flexibility as one of the UK’s key drivers of employment growth over the next decade.”

ICS are one of the leading contractor accountants and administration companies and have helped thousands of contractors working in a range of industry sectors. You can contact us now for a tailored proposal based on your individual circumstances as a contractor.

Their report revealed that more than a quarter (27%) of employers are planning to increase the number of agency workers they employ in the short term. Added to this over half of them (57%) aim to keep temporary staff levels around the same. In the long term the figures are similar, with 22% planning to increase and 65% looking to keep levels the same.

REC Director of Research Roger Tweedy said that this caution and “wait and see” approach was likely to be linked to the economic concerns in the Eurozone, but that confidence and hiring intentions will rise over the course of the year. He continued;

“The outlook for temporary staff remains encouraging despite the Agency Worker Regulations (AWR) now being in force. Since October, 65 per cent of employers have not made any changes to their use of agency workers following AWR implementation.”

“The data also shows that the vast majority of businesses plan to maintain or increase their use of temporary staff which indicates that flexible working options will continue to provide an important outlet for employers and job-seekers.”

ICS work with a team of experts in employment and tax law to ensure our services are fully compliant with existing IR35 legislation and the latest government regulations, such as the AWR. You can contact us now for a tailored proposal based on your individual circumstances as a contractor.

Whilst they admitted that there was a slight fall in temporary jobs at end of last year, this is more likely to be attributed to the poor state of the economy rather than the impact of the AWR. They did however highlight the issues that recruiters are facing with some end clients, and have said that they will continue to address this.

REC’s Director of Policy Tom Hadley said; “It is now over 100 days since the AWR came into force. Despite the slight dip in the number of placements highlighted in last month’s Report on Jobs, overall demand remains strong. Temporary and contract staff will continue to provide employers with a key means of bringing in the right skills at the right time.”

He continued saying; “The feedback from recruiters is mixed and varies from sector to sector. There is no doubt that the regulations have created significant cost and resourcing implications for the industry but the priority has been to reassure client organisations over the ongoing viability and benefits of using agency staff.”

The chairman of REC Healthcare, Andrew Horner, has also backed the vital role that agency staff play within the NHS. He said that as well as providing a pivotal role in delivering services, they also provide a cost effective approach. He said that “portraying agency spend as a waste is not only wide of the mark, it is also hugely disrespectful to the individual temporary workers who perform crucial front-line roles and make a significant contribution.”

ICS work with a team of experts in employment and tax law to ensure our services are fully compliant with existing IR35 legislation and the latest government regulations, such as the AWR. You can contact us now for a tailored proposal based on your individual circumstances as a contractor.

HMRC met with regular member of the forum on January 11th in order to have detailed discussions about the administrational plans for IR35 and the current ideas for the planned business test. A spokesperson confirmed that “following working groups with the external stakeholders, we felt that there was more work to do prior to holding another full Forum meeting”, which led to the postponement.

One of the groups involved in the IR35 Forum, the REC, spoke about the discussions in the November IR35 Forum meeting , which included issues surrounding this tiered business test. They believe that this would help to sift out lower risk IR35 cases and give contractors clarity on their self employed status.

Whilst they also confirmed that progress on the business test required further discussions with HMRC, their representative on the IR35 Forum, Gillian Econopouly, spoke positively of the role of the group. She commented;

“Being involved in the IR35 Forum has provided a unique platform for taking forward the views and recommendations of recruiters in sectors such as technology, engineering and interim management. Whilst the discussions are taking time, we are working hard to establish common ground with HMRC and remain confident that we can help deliver genuine simplification for recruiters and the contractors they place.”

ICS work with a team of experts in employment and tax law to ensure our services are fully compliant with existing IR35 legislation and the latest government regulations, such as the AWR. You can contact us now for a tailored proposal based on your individual circumstances as a contractor

REC Chief Executive Kevin Green was still confident that the UK jobs market is resilient and functioning well despite the tough conditions. He said that “there are clearly signs of decline but we are nowhere near the lows seen in 2009 when the market deteriorated at a drastically faster rate than we are seeing today.”

“Employers are still hiring and using temps in large numbers; however, they are starting the year on a cautious note and are taking their time to make workforce decisions. The quicker the Eurozone sovereign debt crisis is resolved and we get some economic visibility, the better it will be for employer confidence and the UK jobs market.”

Whilst sectors such as engineering, technology and IT were reported to be performing well and remaining strong, Bernard Brown of KPMG comments said that it was “a huge concern to see temporary placements falling in tandem with permanent employment opportunities.” He said that “the decline in temporary roles is a clear indication that businesses are too nervous to even make short-term commitments” which does not inspire hope for the year ahead.

ICS are one of the leading contractor accountants and administration companies and have helped thousands of contractors working in a range of industry sectors. You can contact us now for a tailored proposal based on your individual circumstances as a contractor.

A survey from the Association of Professional Staffing Companies (APSCo) has found that 29% of organisations are likely to terminate contractors early due to the AWR. On top of this 19% of recruiters said that AWR is contributing to a decreased demand for contractors; and 43% said this impact will be greater following the expiration of the first 12-week qualifying period.

APSCo Chief Executive Ann Swain confirmed that the AWR is cleary having an impact, even with top end contractors, due to the increased costs the regulations bring. She said that “Even where temps and contractor are better paid, or outside the scope of the Regulations entirely, there is still a significant compliance burden for both hirers and recruiters.”

She also confirmed the problem between employers and recruiters, which we reported earlier this week. “A lot of recruiters are saying that getting the information from hirers, which is crucial from a compliance perspective, is proving difficult.”

The potential casualties from the AWR, which Ms Swain suggested as being in the tens of thousands, have been seen already in the REC’s latest Report on Jobs, which found that temporary jobs fell for the first time over two years in December.

ICS work with a team of experts in employment and tax law to ensure our services are fully compliant with existing IR35 legislation and the latest government regulations, such as the AWR. You can contact us now for a tailored proposal based on your individual circumstances as a contractor

Despite this point coming in the middle of the festive period, on the December 24^th, there have been few related problems. However, the REC have reported that many recruiters are still having issues co-operating with some employers.

Lewina Farrell, REC Solicitor and Head of Professional Services, confirmed that following the 12 week milestone the REC will monitor the situation closely, advising recruiters what to do regarding any employee claims. Speaking about the problems with some employers she said;

“The feedback from members confirms that some clients remain reluctant to share relevant information for equal treatment purposes with their recruitment partners. An immediate priority is to continue reinforcing the message that the AWR is an issue for both agencies and clients.”

“Clients who do not provide the relevant information to their agencies will be held liable by the employment tribunal for any breaches of the AWR which result from their unwillingness to co-operate. Therefore it is everyone’s interests to develop effective communication channels and imperative that clients pass the appropriate information to their recruitment partners in a timely fashion.”

With other ongoing AWR issues also causing some difficulty for both recruiters and employees it is important for all related parties to be sure of what the implications are. Further information on the AWR can be found on the ICS website.

ICS are one of the leading contractor accountants and administration companies and have helped thousands of contractors working in a range of industry sectors. You can contact us now for a tailored proposal based on your individual circumstances as a contractor.

These views have been shared by the REC, with Chief Executive Kevin Green describing the situation as “fragile” for the first part of the year. He continued that whilst business confidence is low “the UK’s temporary and contract work market remains strong and continues to provide a crucial outlet for business and for workers”.

The REC’s own forecasts predict unemployment to be slightly lower than the CIPD’s, at 2.75m, but that higher end job demand will remain high and public sector cuts will be absorbed by private sector growth by the end of the year.

The group have also published some of their hopes and wishes for what they expect to be a challenging year; as well as looking at the wider picture of the EU addressing the European debt crisis and the global economy improving, they are also hoping for some more specific issues to be addressed.

They want the UK’s flexible work force to be utilised for growth, without AWR having a negative impact. This includes changing people’s attitudes towards temporary and contract workers, which they call “intrinsic part of a cost-effective resourcing models rather than an unnecessary cost that needs to be slashed”.

ICS work with a team of experts in employment and tax law to ensure our services are fully compliant with existing IR35 legislation and the latest government regulations, such as the AWR. You can contact us now for a tailored proposal based on your individual circumstances as a contractor.

The REC have worked hard over the last few years in order to raise this issue of the importance of a flexible workforce and so this commission will only further help the group to pass their own, and their members, feedback to decision makers. This will create a platform for productive discussion on how best to develop the UK’s flexible workforce.

David Frost CBE, previously the director of the British Chambers of Commerce, will chair the group and he spoke positively of its aims; “Our flexible labour market is seen as one of the UK’s major competitive advantages. Quantifying the benefits to business and workers and identifying ways of enhancing this flexibility are the core aims of the Commission.”

“This initiative will not only drive forward the political debate, but will also develop practical solutions for employers on maximizing the benefits of flexible working arrangements.”

The REC’s Executive Kevin Green also commented on the role of the group and said that; “The Commission will take stock of the latest trends and innovations and will lead the debate on how Government can best ensure that, post-AWR, the UK continues to benefits from a dynamic and flexible labour market.”

ICS will continue to follow the progress of the Flexible Work Commission, and will report any updates following their first meeting in January.

ICS are one of the leading contractor accountants and administration companies and have helped thousands of contractors working in a range of industry sectors. You can contact us now for a tailored proposal based on your individual circumstances as a contractor.

Following discussions about the importance of the temporary workforce this meeting established that the AWR has not hugely impacted on this sector, however some misconceptions remain. This included issues such as the use of the Swedish Derogation model, particularly within the IT sector.

REC Director of Policy and Professional Services Tom Hadley, described this finding as “encouraging, but warned that, “We must not take this for granted and must continue to raise awareness amongst client organisations of what the regulations mean and do not mean.”

“The demand for contractors and interim managers remains strong despite the AWR coming into force in October and we will continue to monitor the situation as we approach the first 12 week milestone.”

Recent figures have shown that despite rising unemployment the contract job market is remaining fairly strong, with many employers expected to continue to employ temporary workers over the next year, which shows the confidence from both recruiters and employers that the AWR will not have a drastic affect on the jobs market.

ICS work with a team of experts in employment and tax law to ensure our services are fully compliant with existing IR35 legislation and the latest government regulations, such as the AWR. You can contact us now for a tailored proposal based on your individual circumstances as a contractor.