Graduate Guide to Contracting

Transcription

1 Graduate Guide to Contracting

2 Contents What is Contracting? 3 What to Expect on a Contract 4 What to Expect from Contracting 5 Pre-Employment Vetting 6 Umbrella Companies 9 Personal Service Companies 10 IR35 12 Code of Conduct 15 2

3 What is Contracting? Since the 1980s, contractors have been relied upon heavily within the UK workforce. Most UK businesses have come to recognise what an asset the contractor workforce can be, allowing organisations a level of flexibility not available within employment. The very best talent and the latest skills can be bought by organisations on an as they need it basis. Contractors are recruited to achieve a specific objective or complete a particular project for the client. They achieve it using their own skill set, knowledge and experience and then move on to the next client and project. What are the benefits? 1. Contractors usually enjoy a higher rate of pay than permanent employees. 2. Contractors tend to gain a really good insight into different companies cultures, processes, operations and structures. 3. Working in many different companies gives contractors the ability to build up a varied, but specialist CV and to establish an extensive list of reference contacts. 4. Changing contracts can often be far easier than changing jobs. 5. A good contractor will become known within their own field for their excellent work and they may even find that their services become sought-after. 6. The skills and experience amassed will be valuable to take from one project to the next in order to make each project they work on all the more successful. What are the downsides? Contractors are responsible for finding their own work and making sure that the money keeps coming in. However, at Grovelands it is part of our promise to always do our best to find our associates work. Once a contract is coming near to the end we will find alternative new contracts for associates to start on. We also actively promote A* candidates to our clients in order to help them find their next contract. Contractors have to manage their own taxes if operating through a PSC. Contractors tend to travel where the work is and sometimes live in hotels during their working week. Contracting is highly target driven; contractors need to deliver on challenging targets which can lead to long working hours. What makes a successful contractor? A successful contractor is able to adapt to different projects, quickly learning different systems and ways of working on each project. They must be able to cope well with changing environments and understanding new processes fast. Successful contractors are self-motivated and well organised with the ability to make new working relationships easily. 3

4 What to Expect on a Contract Targets and Performance contractors are appointed to provide a high level of service to clients with a low level of training and you will therefore be expected to reach the targets set for you consistently. You will of course have support from the Grovelands Relationship Management team and from your team leaders on site that will address and resolve any issues that occur. Process Driven Work many of the projects that we offer are highly process driven roles; you will be expected to follow these processes in order to complete the tasks at hand. Long Hours contractors can be expected to work long hours. This is beneficial to the contractor and the client. Possibilities of Overproduction with long hours comes the possibility of overproduction. Many clients will offer incentive schemes such as 5 in 4 where you work 5 days worth of work in 4 days and take an extra day off. However, this is not always on offer. Being Away from Home contractors often move to wherever a contract is available to get the best opportunity they can. Social Aspect contractors will often make good working relationships with one another. They often travel to work and live together and move on to the same projects together. DOs Always act in a professional manner; you must treat contracting as any other job. Grovelands and the client expect the highest quality candidates who will represent both parties as ambassadors of the brand. Inform Grovelands and your team leader if you wish to take any holiday or are off sick. Work to a high standard if you do well on one project and fulfil the contract your next project will be far easier to find. Enjoy the contract you can learn valuable skills, work with great companies and achieve a fantastic career. DON Ts Don t discuss your day rate with other contractors or permanent members of staff it is highly unprofessional, breaches the confidentiality obligations within your contract and will result in the immediate termination of your contract. Don t expect to progress at the same rate as other graduates. Any progression that occurs is at the discretion of our clients. 4

5 You may find yourself on projects with highly experienced contractors who have been in the job for many years; do not expect the same day rate as them. What to Expect from Contracting Each of our clients offers a differing level of career progression. Some have progression plans already in place and others may increase rates in order to retain highly skilled, dedicated individuals. However, regardless of the client or project, contracting is a great path to go down if you are keen to broaden your experience, skills and knowledge. Contracting allows you to move from project to project, accumulating a variety of transferable skills and an understanding of different processes within different companies. These will be highly valuable for every project you work on. After just a few years your day rate could increase significantly. In many cases we work with great contractors time and time again and clients will go out of their way to request certain Associates from us. Being recognised as a strong contractor will help you secure work on a regular basis. Should you go back into permanent work the expertise amassed will be of worth to any future employer, who will be able to utilise the experience you have gained to their benefit. 5

6 Pre-Employment Vetting Due to the nature of contracting in the financial services, the level of pre-employment vetting is very high. We ensure only the highest quality candidates are put forward for our clients roles. This not only involves rigorous interviewing and testing, but also incorporates a high standard of vetting prior to candidates starting a position. What is pre-employment vetting? It s a series of documentary evidence and security checks to prove that you are who you say you are and that you re of sound and fit and proper status. You ll need to satisfactorily complete our vetting process before starting an assignment with us. What information will we need from you? We operate a rigorous vetting process to satisfy our clients individual requirements. We ll provide full details of the documents you ll need to provide when you register with us, but the main information we will need is as follows: Proof of ID Proof of Right to Work Proof of Residence Employment History Proof of Qualifications We ll need to see the originals of these documents so it s best if you can bring them along to your interview, otherwise you ll need to post them to us via Recorded or Special Delivery. We ll also ask you to complete our online Vetting App and any client specific forms, as well as a DBS and credit check. Our online Vetting App is your way of registering with Grovelands. Completing the Vetting App should be a priority; failure to complete it makes the recruitment process far more difficult and can delay your application unnecessarily. What if you re new to contracting? If you ve never been a contractor before, you may find the following useful: It s a good idea to keep all your documents together in one place, as you ll be asked for these each time you start a new contract. You ll need to provide exact dates of residence and employment for the last 3-5 years so if you can find out these dates in advance it ll save you time later. You ll need to either choose an umbrella company or set up your own PSC. If you can t supply any of the documents for any reason there are usually alternatives we will accept. We ll talk you through what documents you need to provide, based on your individual circumstances, before your interview. 6

7 Why do you need to operate through an umbrella or personal service company? Unlike temporary workers, contractors need to operate via a company, rather than as individuals. Therefore you ll either need to work through an umbrella company or you ll need to set up your own PSC. This will be how you deal with contracts and payment. Grovelands - recruits contractors and pays umbrella/psc Umbrella/PSC - pays contractor from Grovelands Client - requests contractors from Grovelands Contractor - employed by umbrella/psc to contract for the client via Grovelands An umbrella company will take away all the hassle of tax assessments and expense claims, but it will usually cost slightly more. If you choose to operate through an umbrella company you ll need to select one from our Preferred Supplier List (PSL) - see page 9. If you set up a PSC we ll need copies of your Certificate of Incorporation, Professional Indemnity and Public Liability Insurance, bank details and VAT registration certificate (if applicable). If you need further guidance on setting up a PSC we can point you in the right direction when you register with us. See page 10 for further information. What type of contract will you get? You will be working on a Contract for Services. Contract for Services It is important to note that this is different from an employment contract. UK contractors are not employees of either the Agency or the End Client. You will have a contract for a specified period of time, a specific project to work on plus agreed rates of pay (usually a day rate). The contract will be between the Agency working on behalf of the End Client, and your own trading vehicle, usually 7

8 either a limited company or umbrella company. It is also important to note that contractors are different to freelancers, sole traders, agency workers and temporary staff. How long will the vetting process take? The Contract Compliance team is the dedicated team to take you through the vetting process as smoothly as possible. If you bring all of the required vetting documents with you to your interview this will speed up the process and we should be able to complete your vetting, including the credit check, within a few days. In short, the quicker you can get all your documents to us, the better! Who should you contact if you have a query about vetting? You ll be assigned a dedicated Contract Compliance Analyst who will be dealing with your vetting from start to finish, ensuring you begin your contract smoothly. Your consultant will be your main point of contact during the onboarding process so feel free to contact them at any time. 8

9 Umbrella Companies If you choose to sign up with an umbrella company they will deal with your contracts, invoicing, tax and insurance. Listed below are the service providers currently on our Preferred Supplier List (PSL). We have a close working relationship with each company and are satisfied that they meet our high standards of service and are fully compliant with all relevant legislation. Tel: Trafalgar Contractor Solutions is a company of established Chartered and Qualified Accountants, supported by a team of client focused professionals with a background and thorough understanding of the UK contracting market. Using Salary Now, their contractors are paid faster than by any other umbrella company, as they are able to pay the contractor before receiving payment from the agency. Trafalgar is a member of APSCo (Association of Professional Staffing Companies). Their systems and procedures have been thoroughly reviewed by a large auditing firm and they are fully APSCo compliant. Tel: Simplify Umbrella is a PAYE umbrella company which prides itself on its excellent customer service. They keep things very clear and straightforward. They offer a fixed fee which includes everything from same day payments, net pay texts and insurances. They don t charge if a contractor doesn t work and there are no set up or exit fees. Simplify Umbrella is a Professional Passport approved provider and has been audited externally on all their processes and policies. Tel: Run by qualified accountants and lawyers with over 30 years experience, PayStream is a PAYE Umbrella company. They offer reliable, efficient and competitively priced services, such as My Max the maximum service, minimum hassle umbrella. Along with a fast joining process the service includes comprehensive insurances, texts, online expenses portal, and they pay within 3 days of receiving an authorised timesheet. There are no set up or exit fees and do not charge if a contractor hasn t worked. PayStream is a member of APSCo and a Professional Passport approved provider and has been audited externally on all their processes and policies. 9

10 Please be aware that we do not work with any other umbrella companies. Personal Service Companies The alternative to umbrella companies is to set up as a Personal Services Company (PSC/Limited Company) through Companies House. Setting up as a PSC does involve more paperwork than operating through an umbrella company, however it may cost less and some contractors believe the paperwork is not much of a burden. The PSC will need to have a registered office address it is usually simplest to use your home address or possibly your accountant s address. As a limited company you will be responsible for completing your tax returns to HMRC (or hiring an accountant to do so), sending your own invoices and ensuring your public liability and professional indemnity insurance are always up-to-date. You will also need to set up a company bank account. What we need from you in order to issue your contract: Certificate of Incorporation Professional indemnity and public liability insurance certificates with cover of at least 1million for each VAT registration certificate if you are VAT registered Business bank account details If you re thinking of setting up a PSC, you may find the following links useful: Professional Passport packed with independent information on the key areas of interest to contractors, including beginners guides on subjects such as operating structures and IR35. Professional Passport Formations a new online company formation service for contractors designed to provide a simple, quick and easy way to form a limited company. Business Link an independent specialist business related site. UK Department for Business Innovation and Skills (BIS) a government website packed with news, information and updates on relevant legislation. HMRC s Businesses and Corporations page invaluable source of information for businesses on tax and related issues. 10

11 IR35 IR35 is UK tax legislation that was introduced by HMRC on 6 th April 2000, with the objective of preventing disguised employment and eliminating tax avoidance schemes. Who does it affect? IR35 only affects contractors whom are operating via their own Personal Services Company (limited company). If a limited company does not satisfy HMRC s definition of selfemployment they will be categorized as caught inside of scope of IR35 thus will have to pay the same tax and NI contributions as a permanent employee would. Those limited company contractors whom are genuinely self-employed are entitled to pay less tax and NI contributions. What if you operate under an umbrella company? If you re employed by an umbrella company, the IR35 rules do not apply to you. Umbrella company contractors are not affected by this legislation as they cannot be viewed as disguised employees as they are employees of their umbrella company, whom pays on their behalf the same tax and NI as a permanent employee would. How do you know if you re affected? In order to establish whether you are affected by IR35, you would need to determine whether your relationship with the client is similar to that of employment i.e. how much control does the client have over how and when you supply your services. Is your contract caught by IR35? If you answer yes to the following questions, it is likely you will be deemed a disguised employee and will therefore fall inside IR35: Can someone tell you at any time what to do, where to carry out the work or when and how to do it? Will you work a set amount of hours e.g. from 9-5, 5 days a week? Can someone move you from task to task? Are you paid by the hour, week or month? Will you receive overtime pay or bonus payments? However; If your answer was no to the majority of the above, but yes to the following, it is likely you will be considered genuinely self employed and subsequently your contract will fall outside of IR35: 11

12 Could you provide a replacement contractor should you become unavailable to complete the work specified? Do you risk your own money? Do you provide the main items of equipment you need to do your job, not just the small tools that many employees provide for themselves? Do you agree to do a job for a fixed price regardless of how long the job may take? What if you get your IR35 status wrong? Contractors who are aware that they are operating inside of IR35 but choose to conceal it in order to pay less tax and NI, will be liable to pay severe penalty fees; should a HMRC investigation into this result in a contrary finding. IR35 legislation is complex and we would advise all limited company contractors to seek independent advice should they be unsure of their status. How can you find out more? You can refer to HMRC s online guidance on IR35: You can download Professional Passport s Beginners Guide to IR35: 12

13 Code of Conduct It is of the highest importance that as an ambassador of Grovelands, you conduct yourself with absolute professionalism at all times while on site. This will not only ensure the continuance of our relationship with you, but also place you in the best possible position with the client. 1. To be aware of and adhere to all client and site regulations and requirements, working standards and procedures. 2. To dress in a manner appropriate to the site. 3. To be courteous at all times to client s employees, suppliers and customers. 4. To exhibit professionalism through punctuality, time-keeping, commitment and general conduct. 5. To make the client aware of any problems or difficulties that present themselves regarding work. If a speedy and satisfactory resolution is not possible, please notify your Relationship Management Consultant. 6. If you are unable to attend the client site for any reason, make absolutely sure that this is communicated promptly to the client and a Grovelands representative. 7. When you are proposing to take leave ensure that this is agreed with the client well in advance and that this takes into account the work schedule under the assignment. 13

14 Contact Us If you re interested in contracting through Grovelands, or would like any further information, please don t hesitate to get in touch with one of the team who will be happy to help. Main Office 5 th Floor Tower Point 44 North Road Brighton BN1 1YR T: F: London Office 2 London Wall Buildings London EC2M 5PP T: F: contactme@grovelands.co.uk 14