The Union of Construction, Allied Trades and Technicians (UCATT) stands accused of pedalling false and unfounded propaganda about Umbrella Companies following the publication of a report by the union in the Guardian.

The report claimed that workers were being forced to use Umbrella Companies and were, as a result, losing out on both pensions and adequate pay. The Freelancer & Contractor Services Association (FCSA), a leading trade body representing professional employment services and the flexible workforce, dismissed the claim as completely groundless and criticised UCATT for painting an unfair picture of Umbrella Services.

Responding to the union’s claims, FCSA CEO Julia Kermode highlighted the fact that Umbrella Employment is “a positive choice for many contractors.” Large numbers of workers, she explained, actively choose Umbrella Employment because it delivers all the statutory benefits of permanent employment but allows the worker to undertake a series of contracting roles while having their affairs managed centrally.

Ms Kermode expressed concern that some of the lobbying and media reports consistently overlook the benefits of Umbrella Employment, adding that it was important for this balance to be redressed to prevent the entire sector being unfairly targeted.

She continued: “Being employed by an Umbrella does in fact ensure the right to pension contributions in the same way as any other employment and that right continues throughout multiple temporary assignments. FCSA works hard to promote compliancy and ethical practices and it is disappointing that UCATT will not listen. I am keen to open up talks with UCATT, which clearly has some misconceptions about the role of umbrella employers. Communication between all parties needs to be improved.”

Meanwhile, the FCSA has announced a series of free seminars for recruitment agencies on proposed changes to travel and subsistence (T&S) tax relief. The seminar roadshow, entitled Travel & Subsistence Changes – How to Minimise Your Risk, will take place in the following cities:

Birmingham – 25th February 2016, between 2.30pm-5:00pm

Glasgow – 29th February 2016, between 2.30pm-5:00pm

Manchester – 15th March 2016, between 2.30pm-5:00pm

London – 22nd March 2016, between 8:00am-10:00am

Should the proposed changes be implemented as the government currently intends on 6th April, Umbrella Companies will be prevented from claiming tax relief on travel and subsistence expenses, resulting in radical changes to the way in which the sector operates. HMRC has widened the definition of supervision, direction and control (SDC) to include the right of SDC, encompassing huge numbers of contracting professionals who were considered independent prior to the legislative change.

Ms Kermode said that there was still much uncertainty about how this proposed legislative change would impact the sector. The seminars are designed to help recruiters to minimise their supply chain risks.

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