2010: Tax employment market, so far

By Simon Godley

Coming into this year, I was quietly optimistic - I had a sense there was going to be more activity in the market, particularly compared to the deathly market of 2009. However, the market now seems broadly the same as the majority of last year. That said, I am writing this during half-term, and I think a lot of the market could be taking a deserved break with their children, hence not many calls being returned.

I have recently made the following observations:

* The interim tax / contract market is not good at all. Most contractors who have come to the end of a contract from late 2008 onwards to date have found it enormously difficult to find a new contract.

* The permanent market is very slow. It feels that the permanent market is slightly better than the interim market. However roles are generally appearing if a key member of the team is leaving, and the hiring manager can get the approval to replace, which in some cases is denied. Or if, by bringing a tax person in-house, will lead to a net cost reduction.

* Recruitment tends to be slightly more buoyant in very specialist areas of the market e.g. VAT / transfer pricing.

I guess generally the message is that the market is prepared to recruit for replacement for key people, but not yet at the stage of recruiting for growth. That could still be some time away.

Having said all that, the market does still 'feel' better than 2009, but not yet mended.

Tax Jobs - Weekly Highlights

This week I refer to the interim tax market, which I feel will most likely remain strong during a downturn, that's if there becomes pressure on in-house tax departments not to recruit permanent members. Things would have to get very tough for this to follow. The job below is very suitable for an ex-Head of Tax, who may have moved onto the contracting market after a number of years in a senior permanent capacity in-house.

Senior Tax Adviser - Interim
Surrey £600 - £800 per day
See More Details

Tax Temps - who employs you?

By Simon Godley
(Legal source: Field Fisher Waterhouse LLP)

In the long-awaited decision of James v London Borough of Greenwich, the Court of Appeal has upheld the decision of the employment tribunal that an agency worker, supplied by an employment agency, was not employed by the end-user (and therefore was not entitled to those statutory rights which are only available to employees, such as the right not to be unfairly dismissed).

The Court of Appeal has clarified, to some extent, in what circumstances an agency worker is or is not an employee of the end user, emphasising that the implication of a contract of service must be necessary to give effect to the business reality of a relationship between the worker and end user.

The Court of Appeal confirmed that the correct legal question is not whether the individual is an "agency worker" but whether he is employed by the end user under a contract of employment. The two types of contract - agency agreement and contract of employment - are not necessarily mutually exclusive and it is legally possible for a worker to have one kind of contract with the agency and another with the end user. A tribunal should therefore assess the factual evidence carefully to determine whether the individual is an employee. Where there is no express contract, the tribunal must consider whether it is necessary to imply a contract of employment between the parties.

In this case, the tribunal was entitled to conclude that the individual, Ms James, was not an employee of the end user (the Council) because there was no express or implied contractual relationship between her and the Council. Her only express contractual relationship was with the employment agency and, similarly, the Council's only express contractual relationship was also with the agency. The tribunal was correct when it found that it was unnecessary to imply a third contract between Ms James and the Council to give business reality to the relationship between the parties: what both Ms James and the Council did was fully explained by the express contracts they had respectively entered into with the employment agency.
Interestingly, the Court added that it is aware of the controversy at both a domestic and EU level about the absence of job protection for agency workers. However, it emphasised that courts and tribunals cannot confer the right not to be unfairly dismissed on a worker who does not have a contract of employment. It is not for them to express views about a change or to initiate change: this is a matter of social and economic policy for debate in and decision by Parliament.

The above case shows that the whole area of companies 'employing' temps via agencies is still a bit of a minefield, particularly regarding the rights of the worker (temp). It seems that the pressure is on the agencies to be very clear about contracts that are put in place, and between which parties.

Any other input or views on this would be very welcome.