Recruiters: Why You Can’t Afford To Work With Wrongly Assessed Contractors

November 16, 2023

As specialists in CIS and umbrella employment, we know our recruitment business partners rely on us to keep them and their clients safe from compliance headaches.

One of the main areas of concern is around the assessment of construction industry contractors to ensure they can genuinely operate on a self-employed basis via the Construction Industry Scheme.

If contractors do not pass tests relating to SDC (supervision, direction and control) and MOO (mutuality of obligation) in particular, then it would not be possible to pay them via CIS self-employment, as they wouldn’t be deemed genuinely self-employed. An alternative, such as Umbrella or PAYE, would be needed instead.

SDC and MOO look at whether a worker has the level of autonomy you would expect of a self-employed person. For example, do they have control over how the work is done? Do they use their own materials, or do they have to use the materials supplied? Do they have control over their work schedule? Do they have to put right mistakes out of their own pocket?

Scenario 1 – a worker who can be paid via CIS

Jayne is an electrician who is responsible for first and second fix on new build homes. She has various professional qualifications and 10 years of electrical experience. She is provided with no guidance or instructions other than the initial assignment detail. She is able to determine how to carry out the work, she works alone and her work is rarely checked.

Scenario 2 – a worker who cannot be paid via CIS

Elaine is a painter whose job it is to decorate student accommodation. She has an NVQ in painting and 3 months’ experience. She is provided with detailed instructions and requires guidance on how to carry out the tasks. The company she works for stipulates how the work needs to be carried out, she works alongside other people and is continually monitored.

How we help

As a recruitment partner of Crest Plus, it’s important for you to know that every contractor who is referred to us goes through our robust contractor assessment process.

In fact, our contractor assessment process is a key point of difference at our company.

Because we are the largest CIS payments provider, and one of the UK’s longest-standing Umbrellas, our contractor assessment process has been finely honed over the years. And to this day, we continually review our process with rigorous external audit by specialist assessors each year with the aim of ensuring it remains water-tight.

“Our contractor assessment process keeps us, our recruitment business partners and our contractors safe. We don’t want anyone to get any nasty surprises with incorrect tax and compliance penalties as a result of being wrongly classed as self-employed.”

Our rigorous assessment process

Our process begins the minute a contractor seeks to join Crest Plus.

Our expert team takes each contractor through a detailed questionnaire over the phone which explores their role, their level of experience and qualifications, their working practices and their supervision structure, among other things.

This questioning process enables us to identify any areas of concern. If the contractor expects to be able to be paid via CIS and is subsequently unable to do so, we will let the contractor and your agency know. We can then explore employing them via our FCSA-accredited Umbrella company straight away, enabling them to get set up and ready to work without delay.

It’s a reliable process which means we gather the information and evidence needed to make a correct, reliable and auditable decision.

We know it’s important to all members of the labour supply chain that we as the payments partner do everything the way it should be done.

Not only does it protect the supply chain from financial penalties but from the reputational damage of non-compliance too.

Next steps

If you would like to partner with us to support your CIS workers, please get in touch on 01244 684700 for a discussion with a member of our account management team.

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