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REC says if the EAA is implemented as currently drafted, it could make it increasingly difficult for freelance IT workers to meet IR35 requirements, and could lead to demise of many businesses.
Its recent survey of 261 freelance IT workers working through limited companies showed 88 per cent of respondents 'overwhelmingly believe the current draft of EAA Regulations would jeopardise their IR35 status.'
Ninety-five per cent considered themselves to be independent businesses rather than ordinary 'work-seekers'.
Despite the DTI's current consultation, which closes on 1 November 2002, 93 per cent of respondents do not believe there are any benefits to being included in draft regulations.
According to REC, this perception is due to a widespread feeling among contractors that the EAA regulations are wholly inconsistent with limited company contractor status and independent businesses. 'The consequences of which will in fact have a detrimental outcome for the industry rather than helping it,' says the Confederation.
Marcia Roberts, REC's External Relations Director, said: "The survey supports REC's long-standing position that higher paid ITC workers as limited companies neither want, nor should be afforded, the same type of protection that is offered to ordinary work-seekers in other industries. This survey shows the strength of feeling among the IT recruitment industry. The DTI must listen and take note of their concerns."
Ann Swain, Chief Executive of the Association of Technology Staffing Companies (ATSCo), recently issued a statement on the exemption of freelance businesses from the regulations.
She said: "ATSCo and the Professional Contractors Group are carrying out a joint survey of contractor views on this matter. "We still hold very serious concerns over the proposed regulations and will be making further representations."
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Richard Powell, © Shout99.com 2002
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