IR35: An opportunity to rethink consultancy

 

The expansion of IR35 looks as though it is here to stay and there seems every likelihood it will become ever more rigorous. Workarounds via umbrella companies and fixed term contracts are not everyone’s cup of tea and will drive up costs all round. New solutions are urgently needed and sometimes it is good to look at the old ones and make a new evolution. The consultancy proposition is a case in point as if properly applied it is firmly outside IR35 and more importantly it is an effective but currently neglected way to help clients achieve transformational change.

 

Many "consultants" will be caught

IR35 - many consultants will be caught

The consultancy approach has become diluted and fallen out of vogue:

  • Too many people call themselves consultants
  • Few of them actually consult
  • They just sell their time.

 Large consultancies have not helped:

  • By putting their own agendas first
  • Seeking to simply “body shop” at a high cost tariff
 

The fashion for “in-boarding”contractors has fuelled the IR35 expansion

 

Clients seeking transformational change have too often acted like employers:

  • By seeking to embed everyone into their organisation and a blanket emphasis on team work
  • This may add comfort value for the client in terms of feeling in control - however transformational change scenarios are really not the right place for comfort zones.
  • The consultant becomes bound by the very culture and baggage that senior sponsors need to change.
  • For many experienced consultants this can often be a dismal and frustrating experience.
  • The client loses the benefits of the healthy input of broader insights to decision making

 

It is time to create a new approach to consulting - agencies and consultants can work as partners

 

IR35 newapproach

 

Agencies and individual consultants can work together to contract with clients in a different way. To provide clients with skills, experience and thought leadership via a structured consultancy proposal. This is a proposition based on adding value through improving business outcomes and is outside of any IR35 considerations. It is also more effective (and cost effective) than the current practice of simply creating a role and paying for time worked.

 

A joint approach to providing consultancy rather than consultants is a “win-win” initiative

 

IR35 winwin

 

Whether you are a prospective client, an agency representative or any other interested party please feel free to contact me with any enquiry, questions or comments. I will be delighted to hear from you.

 David Edgar
Senior Consultant and Director, The Payroll Pathways Consultancy Ltd