Learn more about what substitution within IR35 really means in our handy video guide.
The right mindset
Take professional responsibility for being able to provide a substitute, and to get yourself in the right mindset consider this a business continuity task. As an exercise to stimulate thinking, imagine you have landed a high-value assignment, which is very important to you. Now imagine you’ve had an accident and need to take four weeks off. You must send a substitute in or your client will terminate the contract. You open your business continuity folder and execute your pre-written plan. What is in your plan? Questions to ask yourself include:
- What qualifications & experience would a substitute need?
- How would you find a substitute?
- Do you have a preferred list of substitutes?
- Can you build this from your network? How could your agent help?
- Do you have a due-diligence / vetting checklist?
- Do you have a template contract ready to provide them?
- How would you bring them up to speed on the assignment?
- How / where would they work?
- Does your PI and other insurances cover them?
- Would your cashflow support this?
- Do you need a war chest or access to loans?
- Do you have key man insurance to cover you? (this could cover the cost of a substitute)
- What other blockers would stop you from achieving this? How can you overcome them?
Then, take all of these thoughts and condense them into your own business continuity plan. It’s important to get the level of detail right – you don’t necessarily need to name names, but your plan needs to strong enough to convince your end client (or HMRC) that it is a genuinely actionable plan.
- Being named as an individual in a contract, with clauses that prevent substitution
- Clauses that mean your client has to approve or can veto substitutes
- Having had a substitute refused
Day to day activities and influence
- If appropriate, demonstrate to your client that you take business continuity seriously, and should you be unavailable you will aim to minimise project impact. Provide a high-level summary of your continuity plan, and show them what will happen, where they can provide input, and remind them they can terminate the contract if they’re unhappy with your company’s delivery
- Consider keeping a living knowledge transfer (KT) document. Be overt in letting your hiring manager know that, as part of your commitment to professional continuity, you have such a document should you be incapacitated. But do keep the details of the KT document to yourself because this document is to help your company bring a substitute up to speed, not your end client.
- Look for opportunities to exercise your right of substitution.