HELP! - Contractor with a BIG Problem

an9i77

Hi there. Whilst I have some sympathy that you may not have been dealt with the best way, there's not a lot you can do it about it - you're a contractor, not an employee. You were happy to be a contractor rather than permanent staff when it suited you (more money). Now, it doesn't but you have to take the rough with the smooth. Think of the extra money you earned by contracting as compensation! I'm sure your agency will give you a good ref, that's all you need. Most employers these days don't expect anything more than dates worked from/to and job title on a ref these days.

paddyrg

As said many times - you were a CONTRACTOR, contractors are let go on whatever terms were in the contract. This is why contracting is for grown-ups who don't need a parental employer relationship, instead they get paid more to take more risk. If you got into contracting without understanding this, you took terrible advice, I'm afraid.

2.5 years you're probably borderline considered 'employed' by HMRC (for tax/NI purposes) unless the contract was well-written outside IR35 (and most are not well-written), so the hiring company would be hit twice for tax (once in your exaggerated fee, once direct to HMRC) - making you a very sensible proposition to dump anyway.

Just start looking for other roles using the nest-egg you built up from the hay-making summer. References are less useful on a CV than someone seeing you were a contractor for 2.5 years with a well-known company. Everyone understands contracts renew and end, so it's hardly an issue.

InsideInsurance

paddyrg wrote: »

unless the contract was well-written outside IR35 (and most are not well-written), so the hiring company would be hit twice for tax (once in your exaggerated fee, once direct to HMRC)

I am not an accountant at all but I believe the above to be wrong.

My understanding was that it is you as the employee of your own limited company that is hit as you are taxed as though all (or 95%) of income is salary rather than the normal small salary and rest as dividends.

The client is protected and not liable for anything more as it is a B2B relationship which is why larger clients only accept contractors as a Ltd or via an Umbrella because the contractor is then an employee, just not of the client. They dont accept sole traders as contractors because then the client would be potentially liable for employers NI etc should the relationship status be challenged by HMRC

paddyrg

In fairness II I am unsure of the exact current situation, but http://www.ir35calc.co.uk/cable_wireless_ir35_precedent.aspx was a current story when I was last contracting full-time for one major client.

It's always a bit blurry if the contractor is a disguised employee - even if not for tax purposes, then for other employee benefits

Notmyrealname

chris1012 wrote: »

So the predicament is how do I go about providing references to potential employers and if I do not get a reference is there anything I can do, as I have been wronged and its impacting my future now.

You can't do a thing. Even if you were employed by them they are not legally obliged to give you a reference.

As mentioned, the company you were at were your customer, not your employer. You wouldn't expect the staff at Tesco to ask their customers at the till if they would give them a job reference would you? No. Yet that is exactly what you're wanting.

pinkshoes

You don't work as a design engineer at the company I work at do you??? They've just let loads of contractors go...!

Ultimately, you're a CONTRACTOR, so you get that lovely inflated salary that us permies don't get, but the down side is no pension, no paid holidays, and very short notice period once the company wants a change of scenery.

My employer will only provide me with a reference saying how long I worked for them and my job title, so as your agency will do the same, I don't see what the issue is.

Plenty of engineering jobs out there, and if you don't work for the company I do, then fancy a job for £34/hour?

patman99

£34 p/hr, blimey, I'd like some of that.

isplumm

patman99 wrote: »

£34 p/hr, blimey, I'd like some of that.

hmmmm - that is actually the low end of IT contractor hourly rate!

Mark

System

Not outside London it ain't!

isplumm

!!!!!! wrote: »

Not outside London it ain't!

Ok .... £34 is about £272 a day .... which is not that much really for an IT contractor.

I work on the edge of London, so maybe I am getting more cause of the London factor .... never really thought of it that way.

But I don't work in banking, where daily rates can be £600+

Mark