IR35 Has Settled, But the Impact Still Echoes
Why IT Contractor Hiring Still Requires a Strategic Approach Post-Reform
When the IR35 reforms were rolled out to the public sector, they fundamentally reshaped how organisations engage with IT contractors. While the dust has largely settled, the aftershocks are still being felt, especially by hiring managers tasked with driving digital transformation projects under increased scrutiny and reduced flexibility.
At Certes IT Recruitment, we continue to support hiring teams in navigating this complex landscape. Here’s what you need to know now that IR35 is the new normal, but not without consequence.
More Caution, Less Agility
Risk aversion is a rational response to reform, but it’s becoming a limiting factor. Many public sector bodies have taken a conservative approach, issuing blanket “inside IR35” determinations to avoid compliance pitfalls. While understandable, this often means missing out on highly skilled IT contractors who prioritise “outside IR35” engagements for both financial and professional reasons.
The result? A reduced talent pool and slower progress on transformation goals. In today’s competitive market, agility is key, and overly cautious approaches can delay project delivery and innovation.
The Cost of Compliance: Budget Pressures Mount
Contractors working “inside IR35” are now subject to employee-like tax and NI deductions, without the benefits of employment. To balance this, many have adjusted their day rates upward. For hiring managers, this has real consequences:
- Budget forecasts are harder to manage.
- Project scopes may need re-evaluation.
- ROI on transformation initiatives can be squeezed.
It’s essential to factor these cost dynamics into planning conversations and work with recruitment partners who understand how to align talent costs with business goals.
Contractors Want Clarity, And They Deserve It
Skilled IT contractors are savvier than ever. They’re asking detailed questions about IR35 determinations before committing to roles—and rightly so. Ambiguity breeds hesitation, and hesitation leads to missed opportunities for your team.
Contractors want:
- Clear, documented IR35 assessments.
- Transparent working practices aligned with status decisions.
- Confidence that the client understands and supports compliant engagements.
A Tip for Hiring Managers: Partner for Success
The good news? You don’t have to do this alone.
Working with a specialist recruitment partner like Certes means you can:
- Ensure role assessments are robust and compliant.
- Get support on documentation and determination audits.
- Attract and secure high-calibre IT contractors who are confident in their engagement terms.
In short, the right partner helps you strike the balance between compliance and competitiveness.
Final Thought: IR35 Isn’t the End of Contractor Engagement, it’s a New Chapter
Digital transformation doesn’t stop for regulation. With the right approach, hiring managers can continue to tap into the rich pool of IT contractor talent while staying compliant and cost-aware.
At Certes IT Recruitment, we’re helping public sector organisations navigate IR35 challenges every day. If you’re planning your next transformation initiative, let’s talk about how we can make it a success.
Let’s move forward strategically, compliantly, and with the talent to make it happen. Contact Certes today for a consultation on IR35-ready contractor hiring.
