What was the purpose of the Chancellor’s economic update?

If you consider the factors used to determine status you can include the following terms that are more in line with a self-employed relationship:

• The right to provide a substitute of the contractor’s choice in the event the individual is not able to perform the services;
• The ability to work for other businesses as long as doing so will not affect the services to be provided by the contractor;
• The contractor should have sufficient control over how, when and where (if possible) they provide the services;
• A degree of financial risk can be included for unsatisfactory work or failing to complete a project or task

We have terms that cover all of these points that can be tailored to your needs. The consultancy agreement is included in our IR35 toolkit.

In the event that the worst happens and contractor insolvency occurs, there are a number of steps which the employer should take immediately:

• Confirm that insolvency has actually occurred and the type of insolvency (for example liquidation or adjudication) – actions taken based on rumours can have adverse consequences
• Secure the site and carry out an audit of the plant, equipment and materials present – this may extend to changing the locks on site in order to prevent overzealous contractors and sub-contractors seeking to return and take what they see as their possessions. The building contract may contain a provision that these are the employer’s property, but they can be difficult to recover if they are not within the employer’s possession – possession is 9/10ths of the law!
• Ensure that there are adequate insurance and health and safety arrangements in place for the site – these would usually be dealt with by the contractor and therefore may no longer be in place, so alternative arrangements may be required
• Ensure that any further payments to the contractor are stopped pending a more detailed review
• Consider whether any off-site materials have already been paid for and can be secured. This can however be difficult in practice where the materials are not physically within the employer’s possession

In addition, there are also a number of further actions which the employer should consider in the slightly longer term:

• Investigate the options available and ascertain the cost of completing the works to assist in deciding how best to proceed
• Consider whether termination of the contractor’s employment under the building contract is required, and if so take the necessary steps in accordance with the building contract
• Consider whether there are any bonds or guarantees in place upon which the employer can rely, and if so assess their terms as to whether and how to make a claim
• Make arrangements to complete the works – as a general rule of thumb the cost of completing the works may increase by around 30% if it is necessary to get a replacement contractor
• Consider whether direct payment to subcontractors is possible or desirable
• Although we would say this(!) we would strongly recommend taking legal advice, as insolvency and its implications are complex and it is easy to inadvertently fall foul of the various different requirements

Although these measures fall short of the level of assurance given to employees both in terms of eligibility for an immediacy of access to payments, they are a vast improvement on the support for self-employed workers that has been put in place until now. Current support includes:

• Access to business interruption loans
• Self-assessment tax payments that were due in July 2020 have been deferred until January 2021
• VAT is deferred until the next quarter
• The introduction of Time to Pay arrangements under which deferrals for HMRC payments can be agreed
• The minimum income floor for universal credit has been suspended which will allow self-employed workers to access the equivalent of Statutory Sick Pay (SSP)
• Universal credit and tax credit payments to increase by £1000 per year

The fundamentals of risk assessment remain the same as for any other foreseeable risk.

Focus on risk controls which reflect Government guidance; social distancing (2 metres) and avoiding contact with occupiers if possible, high-quality PPE – disposable overalls, gloves and fluid repellent surgical face masks, ready access to antibacterial wipes for surfaces, tools and equipment and plentiful hand sanitizer.

Mortuaries are a sui generis use, unless ancillary to some other use of land, a hospital for example.

Sui generis uses are not within any Use Class. Consequently planning permission is required for the:

• Change in the use to a sui generis use
• Subsequently for the change in the use to an alternative use, whether that be another sui generis use or a use within a Use Class

Acknowledging the above, if the scale of the use is above de minimis, planning permission is likely to be required to change the use of a warehouse or factory unit into a temporary mortuary.

Should planning control be breached, a local planning authority must decide whether to take enforcement action or not. That enforcement is discretionary was recently reiterated in a Ministerial Statement issued on 13 March 2020 a link to which is below.

https://www.parliament.uk/business/publications/written-questions-answers-statements/written-statement/Commons/2020-03-13/HCWS159/

Depending on the form of the enforcement action, there could be a right of appeal.