With news rules surrounding off-payroll legislation set to come into force from April this year, new research has found that less than one in ten freelancers are prepared for the upcoming changes.
New research shared by freelancer career platform UnderPinned revealed that HR practitioners should therefore be preparing freelance workers for the legislation changes in 2020, as the study revealed a worrying number of freelancers were not even aware of what IR35 was.
This is something that Chris Gray, Brand Leader at Manpower Group, also alluded too, as he previously told HR Grapevine: “Moving forward, it’s imperative that employers keep up-to-date with legislation, such as IR35, and fully understand the implications for their organisations.”
In fact, 42% admitted that they had never heard of IR35, while one in three claimed that the new rules are too complex, and they don’t understand how they will be impacted. In total, that amounts to 74% of freelancers who are unprepared and unaware of how the legislation will affect them.
“The introduction of IR35 to the private sector is lacking in both clarity and support. It seems counterproductive for HMRC to be charging people fines while they make little progress towards supporting or building infrastructure that could support the self-employed,” said Albert Azis-Clauson, Founder and CEO of UnderPinned.
“The future of work is project-based and the infrastructure needs to improve to reflect the changing nature of employment,” Azis-Clauson added.
As part of the new legislation, from April 2020 every medium and large private sector business in the UK will become responsible for setting the tax status of any contract worker they use.
For those who are aware of the changes to IR35, more than one in ten respondents to the survey said that they will end up being financially worse off as a result of the new rules.
Since the announcement, industry experts have called on the Government to reconsider the changes due to the complex nature and unclear understanding of the new rules.
Julia Kermode, Chief Executive of the Freelancer & Contractor Services Association, has previously branded the upcoming changes as being ‘fundamentally flawed’.
She explained: “The proposed legislation changes are fundamentally flawed and are already having a very detrimental impact on businesses and professional contractors. We are seeing some firms opt for cheaper resources overseas and the potential impact on the UK’s economy is significant.
“Therefore, it is essential that we join together for this protest so that we can make ourselves heard by MPs who are the only ones with the power to prevent this disastrous legislation becoming a reality,” Kermode added.