Why is hiring temp staff to cover strikes is not the best approach? And, what is the latest on IR35?

In our latest podcast, Amelia Brand is joined by Julia Kermode and Seb Malay who discuss the nature of strikes, and also the recent changes to IR35 legislation and its impact on HR.

Can businesses prevent strikes?

It’s not always straightforward, of course, but fair pay and treatment, in addition to good working conditions and rights, provide a solid foundation, explains Julia.

“COMMUNICATION BETWEEN EMPLOYERS AND WORKERS IS ALSO KEY.”

– Julia Kermode 

Remember that strikes are usually the last resort. The more you know about how things are for your team at the coal face the more you will be able to ensure you are doing everything reasonable from an employer perspective.  

Julia urges organisations to think about their perspective and what they care about. What can you agree on?  Is there a middle ground? 

Why is using temps to cover striking staff not the best approach?  

 Temps plug vital skills gaps and keep the wheels of business running, in the event of strikes, for example.  

 However, there is a risk that temps could walk into hostile environments by crossing picket lines and it would be irresponsible not to make them aware of that. As temps may prefer to decline the work, I am worried that they won’t be informed or won’t have any choice about accepting the work if they need the income.   

 

“ALSO, USING TEMPS TO COVER WILL UNDERMINE YOUR EXISTING STAFF WHICH IS LIKELY TO EXACERBATE THE SITUATION AND PROLONG TENSIONS.”

– Julia Kermode

P&O Ferries: what went wrong here?

Julia explains how all of P&O Ferries’ crew employees in Britain were fired and then replaced by agency workers, who provided a cheaper alternative.  

 The issue here is not only that around 800 employees were made redundant in such a cruel manner (staff were told in a video call that they would be let go with days notice), but that temps were then drafted in at a moments’ notice to plug the gaps. 

 

“NOW, THE FLEXIBILITY AND ABILITY OF TEMPS TO PLUG SKILLS GAPS AT SHORT NOTICE IS ONE OF THEIR GREATEST STRENGTHS. HOWEVER, MORALITY SHOULD COME INTO PLAY BY THE EMPLOYER – NOT TO MENTION THAT THESE TEMPS WALKED INTO THE EYE OF THE STORM.”

– Julia Kermode

Worse still, P&O’s strategy was technically legal and aside from reputational damage, the firm has not been held accountable. 

What about IR35?

Seb firstly explains what IR35 is, highlighting that it is a UK tax legislation which aims to close a loophole in the tax system whereby workers could pay less tax by setting up a limited company (or partnership) than they would if employed. 

Introduced in 2000, and up until 2017, contractors were responsible for determining their IR35 status – in other words, assessing if the service they provided clients was delivered in a manner akin to self-employment or employment.  

 Changes to the legislation

In 2017 in the public sector and in 2021 in the private sector, IR35 reform was introduced. This saw the end-client tasked with assessing IR35 status and the liability transferred from the contractor to the fee-paying party in the supply chain – typically the recruiter. 

The off-payroll working rules, as they’re known – while manageable – have caused disruption and led to lots of contractors being told by clients that they must operate on the payroll, irrespective of their true IR35 status.  

The Liz Truss government clearly recognised this and Kwasi Kwarteng announced that reform would be repealed in April 2023, with contractors to become responsible and liable once more for IR35. 

 

“WE ALL KNOW WHAT HAPPENED LESS THAN A MONTH LATER, WITH THE NEW CHANCELLOR JEREMY HUNT U-TURNING ON MOST OF THE MINI-BUDGET, INCLUDING THE IR35 REFORM REPEAL.”

– Seb Malay

Seb then goes on to explain whether or not we are likely to see more changes, or perhaps even another repeal.

To listen to the free podcast, click here now!

 

 

 

 

 

 

 

 

Amelia Brand
Amelia Brand

Amelia Brand is the Editor for HRreview, and host of the HR in Review podcast series. With a Master’s degree in Legal and Political Theory, her particular interests within HR include employment law, DE&I, and wellbeing within the workplace. Prior to working with HRreview, Amelia was Sub-Editor of a magazine, and Editor of the Environmental Justice Project at University College London, writing and overseeing articles into UCL’s weekly newsletter. Her previous academic work has focused on philosophy, politics and law, with a special focus on how artificial intelligence will feature in the future.