How is IR35 changing?
The current position is that the PSC is responsible for assessing whether IR35 applies. This current regime has been difficult to police by HMRC and HMRC considers there is widespread flouting of the rules by contractors.
From April 2021 the responsibility for assessing whether IR35 applies will shift to the end user/client (with the exception of ‘small’ companies) which will require an assessment to be carried out on a contract by contract basis. HMRC anticipates that this will be easier to monitor and that end user businesses will be more compliant.
The reformed regime will apply to payments made on or after 6 April 2021 for services carried out on or after this date.
Related FAQs
The outbreak is certainly going to have an impact on new lease negotiations.
Undoubtedly many transactions will be put on hold or indeed stop entirely. Where matters are ongoing, tenants may well look to strengthen rent suspension provision.
It is also possible that tenants and their representatives will also now seek to include termination rights for unseen events. In this regard, the concept of force majeure may start to appear more often in leases.
In both of the examples above, such attempts are not likely to be well received from landlords who will undoubtedly suggest that tenants ensure that their business interruption insurance policies are robust enough to protect the tenant in the event of any future pandemic events.
Another approach tenants might adopt going forwards in negotiations for a new lease (or indeed seeking to vary existing leases), is to move away from the traditional market rent model to a turnover rent arrangement. This will offer some protection going forward if trading conditions deteriorate, but again getting institutional landlords to agree such an approach may prove difficult.
In recognition of the problems that the current situation is causing, the UK IPO classed the 24th March and all subsequent days as “interrupted days” which means that deadlines that fall within this period will be extended until the UK IPO declares that the interrupted days have ceased. As lockdown has begun to be eased, the IPO has now reviewed its position and has confirmed that the “interrupted days” period will come to an end on the 29 July 2020. This means that Thursday 30 July 2020 will be the first normal day of operation, therefore all “interrupted days” deadlines will expire on this day. Similarly, if your deadline falls after the period of interruption ends, this deadline will not be automatically extended.
The IPO is conscious that many businesses may still be in challenging positions when the period of “interrupted days” end. They will endeavour to continue to provide flexibility and support to assist businesses with their applications. They hope to temporarily remove fees for requests for extensions of deadlines, and will give further updates when this fee exemption is in place.
The IPO continues to encourage applicants to meet original deadlines where they are able. As their offices are closed, the UK IPO is not currently processing paper forms (i.e. hard copy) and faxes. However, they are processing forms which have been submitted electronically, or via email and have made a new email address available for the submission of forms.
Intellectual Property Offices covering other territories have made their own announcements about the extension of deadlines. The EUIPO’s period of extension of deadlines came to an end on the 18th May. However, they have published a Guidance Note and accompanying webinar on the EUIPO website, detailing options for parties who may struggle to meet deadlines and remedies for those who may have missed deadlines.
Follow up to date UK Government advice. This can be found at: https://www.gov.uk/government/publications/guidance-to-employers-and-businesses-about-covid-19/guidance-for-employers-and-businesses-on-coronavirus-covid-19
For best practice and more detailed information; consult the HSE’s website at https://www.hse.gov.uk/news/coronavirus.htm
Failing to follow the guidance is likely to be regarded as failing to take all reasonably practicable steps.
The guidance has confirmed that all remaining employment rights and terms continue while an employee is furloughed. Holiday will continue to accrue during furlough however you may reach agreement with employees on reducing entitlement provided that it does not fall below the statutory minimum of 5.6 weeks per year.
It is worth pointing out that, despite all the guidance, survey results and other advice about managing Covid-19 H&S risk in the workplace, the law has not been changed. None of the guidance is codified by regulation/legislation, which means that you are managing this risk in the context of existing H&S law.
In very simple terms, HASWA74 requires employers to take “all reasonably practicable steps” to ensure the health and safety of its employees (and anyone else affected by your business).
“Reasonably practicable” means to balance risk reduction against the time, money and effort required. If measures are grossly disproportionate, you wouldn’t be expected to take them, but there is a strong presumption in favour of taking any steps which will protect workers.
As part of managing the health and safety of your people, you must control the risks in your workplaces. To do this, look for what might cause harm to people while they work and decide whether you are taking reasonable steps to prevent that harm. This related duty under MHSWR is to ensure you undertake a “suitable and sufficient assessment of risks.”