Half of recruiters no longer happy to engage with self-employed contractors
8 October 2014
Half of recruiters are no longer happy engaging with self-employed contractors, although 69% claim that the onshore employment intermediaries legislation has not had a negative impact on their business, according to research conducted by Anderson Group and Recruiter.
Wed, 8 Oct 2014 | By Nicola Sullivan
Half of recruiters are no longer happy engaging with self-employed contractors, although 69% claim that the onshore employment intermediaries legislation has not had a negative impact on their business, according to research conducted by Anderson Group and Recruiter.
The data showed that 22% of respondents said the legislation has had an impact on their business but it isn’t as bad as they first feared. However, 8% said the impact has been significant and required major changes to be made.
Enforced in April, the regulations make recruitment and staffing firms liable for the tax and National Insurance Contributions for workers in the supply chain falsely operating on a sole trader or self-employed basis.
The research also found 23% of respondents believed that government red tape has had the most negative impact on plans for growth. However, half of those questioned forecasted 10% or more top-line growth over the next year.
While a third of respondents already have a presence outside the UK, almost half (42%) said they either had plans for overseas expansion, or said it was something they will look at in the future.
Appetite for outsourcing non-key functions is strong with 36% already doing so and a further 19% said it’s something they would consider. Fear of losing control of parts of the business is the largest barrier to 33% of those thinking about outsourcing.
Steven Zahab, group commercial director of Anderson Group, told Recruiter: “It was interesting to note how many recruiters still had compliance work to do after the legislative changes became law. This demonstrates just how difficult it is for businesses to respond when the government implement such sweeping changes so quickly. What was particularly pleasing however was that in spite of legislative change and 'red tape' recruiters were still forecasting growth, which underlines the current strength in our sector.”
Other key findings include:
Watch out for Recruiter’s coverage of a roundtable discussion (organised in conjunction with Anderson Group) on the onshore intermediaries employment legislation in the October issue.
The data showed that 22% of respondents said the legislation has had an impact on their business but it isn’t as bad as they first feared. However, 8% said the impact has been significant and required major changes to be made.
Enforced in April, the regulations make recruitment and staffing firms liable for the tax and National Insurance Contributions for workers in the supply chain falsely operating on a sole trader or self-employed basis.
The research also found 23% of respondents believed that government red tape has had the most negative impact on plans for growth. However, half of those questioned forecasted 10% or more top-line growth over the next year.
While a third of respondents already have a presence outside the UK, almost half (42%) said they either had plans for overseas expansion, or said it was something they will look at in the future.
Appetite for outsourcing non-key functions is strong with 36% already doing so and a further 19% said it’s something they would consider. Fear of losing control of parts of the business is the largest barrier to 33% of those thinking about outsourcing.
Steven Zahab, group commercial director of Anderson Group, told Recruiter: “It was interesting to note how many recruiters still had compliance work to do after the legislative changes became law. This demonstrates just how difficult it is for businesses to respond when the government implement such sweeping changes so quickly. What was particularly pleasing however was that in spite of legislative change and 'red tape' recruiters were still forecasting growth, which underlines the current strength in our sector.”
Other key findings include:
- 64% - proportion of respondents that said the onshore intermediaries legislation has not affected their appetite for risk.
- 36% - proportion of respondents that said the legislation has made them feel less likely to take risks.
- 53% - proportion of respondents that do not believe the HMRC was right to legislate in this way but accepted something had to be done to stop tax avoidance.
- 39% - proportion of respondents that said ‘yes’ the legislation is justified.
- 8% - proportion of respondents that said ‘no’ the legislation is totally unjustified.
Watch out for Recruiter’s coverage of a roundtable discussion (organised in conjunction with Anderson Group) on the onshore intermediaries employment legislation in the October issue.
