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Dragonfly crashes to earth

30 September 2008 / Kevin Miller
Issue: 4178 / Categories: Comment & Analysis , Arctic Systems , Dragonfly , IR35 , Jones v. Garnett
Should we be in a state of panic about the High Court decision in Dragonfly Consultancy, asks KEVIN MILLER

KEY POINTS

  • Right of substitution is often the key to IR35.
  • Who determines the work is critical.
  • Substitution clauses can be problematic.
  • The control issue was the contractor's undoing.
  • Not having a right of substitution clause is not always crucial for self-employed status.

Contractor websites like Shout99.com and Contractor UK are full of alarmist comments about the impact of the recent judgment at the High Court where Mr Bessell of Dragonfly Consultancy Limited lost his IR35 appeal.

For example the managing director of the Professional Contractors Group (PCG) who financed Mr Bessell's appeal is reported as saying: 'This is a potentially massive blow to freelancers throughout the country. This case threatens the long-established defences against IR35'.

However I am not convinced the judgment represents such a change in the underlying employment...

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