Does being a ‘key worker’ impact IR35 status?

I’m a ‘key worker’. Does that mean I belong inside IR35?

Q. I’m a contractor working in a Government department on a contract that sits outside IR35. Everyone there – civil servants and contractors – have now been designated as ‘key workers’ in the context of the Coronavirus. This follows Government guidance: “Those administrative occupations essential to the effective delivery of the COVID-19 response or delivering essential public services such as the payment of benefits, including in Government agencies and arms length bodies.” With this in mind, I’m interested in understanding if being a ‘key worker’ will affect my IR35 status in any way?

A. While the term ‘key worker’ is a phrase that a genuine contractor might not want to be associated with – given it could perhaps signal an employment relationship – it’s unlikely that it would jeopardise your outside IR35 position in this scenario. If the service you provide your client day-in-day-out remains unchanged and the contractual terms still also reflect an outside IR35 engagement, then simply being classed as one shouldn’t – in theory – endanger your outside IR35 status. 

The Government guidelines for ‘key worker’ outline a plethora of professions, industries and services which are likely to be carried out by employees and contractors – it also touches on ‘arms length bodies’, which a contractor could technically be defined as. From what we can see, this information doesn’t identify only employees as ‘key workers’, which suggests that the term ‘worker’ is simply being used to cover everyone, irrespective of whether you contract for an organisation, work as an employee or even provide services via a larger business. 

Also worth noting is that being a ‘key worker’ only refers to the type of work that you carry out, which the Government currently classes as an essential service. It doesn’t refer to your employment status, as the term can apply equally to employees, the self-employed and anyone with a specific set of skills. 

Therefore, while being considered a ‘key worker’ suggests you are business-critical to an organisation, if your contract and working practices reflect an outside IR35 engagement, this classification shouldn’t threaten your true contractor status.

This answer was provided by IR35 specialist, Qdos Contractor.

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