Sadly the reasons for introducing IR35 were completely valid. A lot of companies were exploiting the fact that they could avoid responsibility for paying national insurance and providing employee benefits by making everyone "self employed".
This had a dramatic impact on low paid workers - being self employed meant that they no longer received any benefits that would have come to a proper employee (e.g. sick pay, paid time off).
Unfortunately the legislation also impacted highly paid contractors and consultants.
Disguised employment is a big issue and a large number of people are being exploited. It's a shame that our governments have been unable or unwilling to legislate effectively.
I guess this move is a recognition that the unintended consequences were too significant for Tory voters.
It meant a suppression of wages in the IT sector (because employers don’t need to compete with contract rates) and reduced the ability of businesses to quickly spin up a team for a project because of the extra risk and process involved in hiring perm employees.
There are plenty of people operating in the world of small tech businesses that others might assume are natural Tory voters but who definitely aren't in reality. With today being a rare exception the Tories haven't really done much to help small independent businesses over the years. That of course includes contractors and freelancers working in tech but also tradespeople, drivers who come with their own specialist vehicles, some childcare providers, many people who work in health, fitness or beauty occupations, and a very long list of others.
At some point the Tory leadership had to notice that there are now vast numbers of voters who work as independents or have a second part-time independent gig on the side. I won't cite specific figures here because I don't know the methodology behind the ones I've seen but apparently we're talking about several million people now so that's a significant proportion of the entire working age population. Given that the age profile in this country means they're going to lose much of their reliable support from older "Tory all my life" voters over the next 10-20 years they urgently need to find other large demographics who might vote for them instead.
Generally speaking the conservatives have two demographics. I like to call them “Average Fantasists” and “Ideological Donors”.
Appealing to either group is an exercise in optics. The Average Fantasists will still vote conservative despite being much more closely aligned to Labour policy (think NHS, rail nationalisation, police funding etc) because of non-issues such as immigration, the EU, the Royal Family, other Nationalism etc. The Ideological Donors on the other hand have a strong belief in free market economics and finance as the main economic driver, both of which are harmful to an economy in the medium to long term (and often the short term too.)
Current IR35 rules were just bad optics to both groups. I’m personally super happy about the reversion back to the old rules. But I’ll never vote Tory, they’re a blight.
> The Ideological Donors on the other hand have a strong belief in free market economics and finance as the main economic driver, both of which are harmful to an economy in the medium to long term (and often the short term too.)
How exactly is free market economics harmful to the economy?
This had a dramatic impact on low paid workers - being self employed meant that they no longer received any benefits that would have come to a proper employee (e.g. sick pay, paid time off).
Unfortunately the legislation also impacted highly paid contractors and consultants.
Disguised employment is a big issue and a large number of people are being exploited. It's a shame that our governments have been unable or unwilling to legislate effectively.