In the ever-evolving world of interim and contract work, IR35 continues to be one of the most talked-about—and misunderstood—topics. For businesses and professionals alike, the legislation was meant to bring clarity. Instead, it’s created a fog of uncertainty and frustration, particularly for the many highly skilled contractors who have always operated legitimately outside of traditional employment structures.
At its core, IR35 was introduced to tackle “disguised employment”—situations where individuals functioned as employees in all but name, while enjoying the tax efficiencies of self-employment. The principle was (and still is) fair. The challenge lies in how it’s been interpreted and applied in practice.
The Blanket Approach: A Blunt Instrument?
Since the off-payroll reforms were extended to the private sector, we’ve seen a significant shift in how businesses approach contractor engagements. Many have opted for a blanket determination of “inside IR35” across the board. While this may seem like a safe compliance strategy, it often overlooks the genuine nature of many contractor relationships.
This blanket approach can result in businesses treating skilled, independent professionals as employees for tax purposes—without providing the corresponding rights and benefits that come with employment, such as holiday pay, sick leave, or job security. Unsurprisingly, many contractors see this as a raw deal.
From our perspective as a specialist recruitment agency working closely with both clients and contractors, this approach also poses a commercial risk to businesses. It can limit access to top-tier, flexible talent—the very professionals who prefer to operate independently and take on their own financial and operational risks. In a talent-short market, this can hinder agility, innovation, and project delivery.
What’s the Cost of Misalignment?
For genuinely self-employed contractors, being forced into an inside IR35 role undermines the very reasons they chose to contract in the first place—autonomy, flexibility, and the ability to build a business on their terms. Many are fully VAT-registered, engage accountants, manage their own tax affairs, and hold liability for the work they deliver. They are not looking for permanent jobs—they’re building careers as business owners.
The result of pushing these individuals into inside IR35 contracts? Some walk away. Others increase their rates to offset the cost. And some simply leave the contracting world altogether. All of which contributes to a less competitive, less dynamic talent ecosystem.
A Call for Clarity and Common Sense
We believe that compliance and fairness are not mutually exclusive. IR35 doesn’t need to be a barrier to interim hiring—it just needs to be applied with care, thought, and accuracy.
Rather than resorting to one-size-fits-all solutions, businesses should work with knowledgeable partners to properly assess contractor engagements. Tools exist. Expertise exists. And so does a contractor population that wants to engage transparently and professionally.
As we move further into 2025, perhaps it’s time to pause and ask: Are we truly supporting the future of work—or are we still solving yesterday’s problems with yesterday’s methods?
At Envisage Recruitment, we’re committed to helping businesses navigate IR35 with confidence while protecting the value that professional contractors bring. It’s not about bending the rules—it’s about understanding them, applying them sensibly, and ensuring that both parties in an engagement are respected.
If you’d like to discuss how we support compliant, flexible contractor hiring that works for everyone, our team is here to help.
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