Review of modern working practices

Last updated: 23/04/2024

The government published a consultation titled Tackling non-compliance in the umbrella company market, which proposes closer regulation of umbrella companies and options for responsibility for unpaid tax debts by umbrella companies to be borne by the agencies and end users of the labour supplied by umbrella companies. This could have wide-ranging consequences for the flexible labour market following the reform of off-payroll working (IR35).
On 18 April 2024, HMRC published an update, indicating that the government is ‘minded to introduce a due diligence requirement to drive out bad actors from labour supply chains’. However, a formal response to the original consultation is still outstanding. On 22 April 2024, HMRC issued a warning for employment agencies using umbrella companies in ‘Spotlight 64’.
The case law surrounding employment status and worker rights continues to evolve at pace, with several lead case decisions expected to have a significant impact on how employment status is to be determined. Important decisions are currently awaited from the Supreme Court in PGMOL and from the Upper Tribunal in S&L Barnes Ltd and Basic Broadcasting Ltd.
Timing: no specific reform plans or timetable have been announced.