Contractors’ Questions: What are Key Information Documents?

Contractor’s Question: There was some talk about Key Information Documents a few months back, but I’ve not heard anything since. Does that mean that the documents are no longer going ahead from next April? What are the requirements on contractors regarding these documents and where did they come from? And aren’t they rather out of the blue?

Expert’s Answer: Key Information Documents are indeed incoming from April 6th 2020 and they were a key recommendation in the Good Work Plan, which was inspired by the Taylor Review of Modern Work Practices.

But rather than a requirement on you, as a contractor, Key Information Documents will be a requirement for all recruitment agencies, as they will need to be ready to issue them from April 6th 2020.  The Key Information Documents will need to be given to candidates prior to signing up with an agency.

The aim is to provide transparency on how a candidate is to be paid, whether directly to their Personal Service Company, via agency PAYE, or via an umbrella company employer. 

The relevant regulation does not require new Key Information Documents to be produced for each and every assignment worked through any agency, simply once at the sign-up stage. This should head off too many concerns about Key Information Documents representing a lot of new red tape.

That said, the new requirement is likely to mean that recruitment businesses will need to work more closely with their umbrella company partners to ensure that accurate information is given to their candidates. From our perspective, we welcome the increased focus on compliance and transparency, which has got to be a positive development for contractors and agency workers as a whole.

The expert was Julia Kermode, chief executive of the Freelancer and Contractor Services Association.