Temp Employment Contracts

[clade]

Ive been working for a company for just over a year now ( two six month contracts) and ive just been offerd a 5 month extention. I didnt think anything more about it untill I saw another post the forums about a law regarding hireing temps for more than 50weeks.

What is the deal with this? ive had a google fail.

Im just thinking great another 5 months experience and money in a recovering market. Apart from the hole living my life 5/6months at a time thing.

 

[Vonhelmet]

I'm pretty sure it's complete garbage.

The only thing I can think of would be that there is some bizarre tax idea at work, but the only thing that springs to mind would be paying petrol money for employment at a termporary workplace, but that has a two year cut off.

 

[Admiral Huddy]

I think Von is right .. it is tax. IR35 springs to mind because effectively you are a permy. The company and contractor could be liable for evading NI.. but i could be wrong.

 

[Vonhelmet]

I think Von is right .. it is tax. IR35 springs to mind because effectively you are a permy. The company and contractor could be liable for evading NI.. but i could be wrong.

If the employment contract is with a temping firm, then this is probably the problem. That hadn't occurred to me until you mentioned this. I'm not aware of a year being a particularly significant timescale for this, but it could be that the Revenue regard a year as permanent and anything less than that as being temporary.

The problem would be that if you are employed by the temping firm, then they pay your salary, deduct your tax and NI and pay the employers NI. If you're actually working for the company, but employed by the temping firm, then the company is not paying your NI, even though you're employed by them.

It's all fairly arbitrary, and it's generally fairly innocent, but HMRC don't like personal/managed service companies much as they can be used to abuse the system and avoid tax/NI.