The Association of Recruitment Consultancies (ARC) has echoed the thoughts of many workers by calling for the government to change and modernise its policy on agency tax and employment relations.

As part of its ‘Post-Brexit manifesto’, the ARC has identified five key areas it would like the government to address in light of the UK’s decision to leave the European Union.

The first is ‘adopt a single, positive, overarching policy towards the recruitment sector’, while the second asks the government to remove antiquated tests in agency tax rules. The suggestion from the ARC would be to implement a tax payment policy ‘based on supply as the common factor’.

The other three ARC calls include the creation of a tax relief policy for all agency workers, the implementation of a joined up tax policy, and the removal of  the ability for agency workers to claim employment rights against a hirer.

Fundamentally, the ARC believes too many of the government’s current methods to be outdated and counter intuitive. One example highlighted was the current approach to tax and the new proposed IR35 rules. These place liability and administration on the agencies, and is something ARC deems to be ‘counter-productive’.

“I believe the government should distance itself from old tried and failed methods, such as the reliance on the outdated, outmoded test of direction, supervision or control which simply cause confusion,” said Adrian Marlowe, chairman of ARC. “This requires modernisation and a new mindset.”

Marlowe added: “The scrapping of home to workplace travel tax relief should also be reviewed and the conflict which arises when an agency worker has rights under the Agency Workers Regulations and employment rights against a hirer should be resolved. Our suggestion would not only streamline processes for agencies and HMRC but should achieve the double benefit of supporting the industry whilst fully addressing the government’s concerns over tax avoidance.”