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Beating up the BBC (again)

Today I opened my copy of The Times – chockful of Brexit coverage, natch – and at page 10 came upon  a report headed BBC paid £700m using tax loophole, apparently the latest development in the long-running row over BBC pay that has included elements of public outrage at the size of BBC presenter salaries, at the fact that for years across the board females have been paid less for ‘similar’ jobs both generally and specifically those they are working alongside, and also – of course – that some presenters were allowed to ‘provide their services to the  corporation through service companies’ and indeed (as this latest report highlights) at one point the BBC was actively encouraging some presenters – both male and female – to set up limited companies specifically to do this.

Way back in the day (viz. the early 1980s), when I worked at an ITV company, we encountered all these (and the attendant related issues) as they came to us, one after the other, in earlier legislative forms.

I have blogged on this subject before on the Rust from that perspective in order to point out some of the issues, complications and ongoing misconceptions in the minds of those PC-obsessives and strident ‘holier-than-thou’ tax fascists currently pursuing the BBC from pillar to post about the way it went about hiring not least its ‘front of camera’ staff, what it paid them – and indeed how.

In that sense, therefore, I make no apology for entering the lists once again today.

In the 1970s and early 1980s UK tax law was much simpler than it is today.

People were either employees (in which case they were taxed PAYE at source and the employer paid NI on top) or they were not employees but ‘freelancers’ (in which case they arranged their own tax affairs with HMRC but were denied benefits available to employees such as holidays, pensions, plus sickness and maternity rights).

The biggest difference between employees and freelancers was in employment rights – and some might think quite rightly. These babies, incidentally, were quite distinct from the tax laws in those days.

New laws came in decreeing that anyone who worked at an organisation for two continuous years (24 months) acquired employment protection, which meant that they had the right not to be ‘let go’ unfairly (unless they had resigned entirely off their own bat, obviously) and they could get substantial amounts of compensation – or even gain an order to be re-instated – if the employer could not prove they had been dismissed ‘fairly’ if an employment-protected worker resorted to law, e.g. via an employment tribunal.

Not just in TV and media companies these laws presented big problem for employers.

You might hire a team of creative or production executives to work on a major documentary series that could take 2 to 3 years to complete – and that was it.

Neither you nor they – at the time of the hiring – might have ever intended to work together again, not least on the individual’s part because most of them were either genuinely freelance, or had supplied themselves through (freelance) personal service companies, through which some were employed PAYE to their own company, or were even ‘freelancers’ working for it. In which case they certainly didn’t wish to be classed as ’employees’ of an organisation since that might affect their freelance tax status.

And yet, whenever any of them reached that milestone of two years working for a TV company, they ostensibly acquired ‘employee protection rights, whether they wished to or not!

The ITV company I worked for ended in the invidious position of finding itself saddled with a growing number of senior creatives for whom we had no more work but whom, if we tried to move them towards the exit door were technically in a legal position to sue us for ‘unfair dismissal’.

Even though (for HMRC purposes) they were officially freelancers – well, certainly not employees in any ‘proper’ sense.

And if employment law decided they had employment protection (i.e. were employees) – so we couldn’t dismiss them – the employer, not the employee, was responsible for any income tax that hadn’t yet been collected/paid!

I repeat: that was then – I’m not referring to the position on tax and employment as it is today.

But to fast-forward to the BBC in 2018.

When the BBC began being hit over the head by those pursuing transparency as to its numbers of employees – and indeed the publication of a list of top earners’ salaries – one way of ‘limiting’ both – and incidentally, of course, the exposure of its senior presenters (after all, which highly-paid person necessarily wants his or her salary to be writ large on the front page of the Daily Mail?) was to shift highly-paid presenters generally into non-employee status.

This had the added benefit that – if they weren’t employees – they weren’t eligible for any staff benefits such as pensions, maternity leave and sickness pay.

Again, if you’re told to publish the numbers and salaries of all your employees, if a chunk of them are no longer employees you don’t have to include them in that category or reveal what you pay them. Plus they – not the BBC – have to deal with their own tax affairs.

Furthermore – in the modern world of ‘joined-up’ areas of the law – if a presenter is deemed to be a freelancer, they cannot these days acquire employment protection rights – thus you can fire them at the drop of a hat whenever you feel like it, e.g. when they hit 60 … or get fat and old … or … er .. no … wait a minute!

Under the latest PC laws, of course, you cannot be fired for being old (that’s age discrimination) or being fat and ugly (and that’s fattist and uglist discrimination) …  and  probably not even for having lost your mojo or even just now being bloody awful at your job (that’s … er … discriminatory to hopeless workers).

But that’s by the by anyway …



About Gerald Ingolby

Formerly a consumer journalist on radio and television, in 2002 Gerald published a thriller novel featuring a campaigning editor who was wrongly accused and jailed for fraud. He now runs a website devoted to consumer news. More Posts