Supporting a broad and diverse business group with a specialised approach to IR35

Co-op, the British consumer co-operative is a diverse family of retail businesses including food retail and wholesale; as well as insurance services, legal services and funeral care. With such a broad group, the Co-op’s contractor population can total up to 2,000 at any one time, with temporary workers operating in a wide range of positions – from carrying out activity in Co-op’s food depos to working within IT on group transformation or business acquisition and sales. Because of its unique set-up, the Co-op needed IR35 support from a provider which understood their business model and could therefore ensure their contractor talent was classified correctly and fairly.

The challenge

To ready themselves for IR35 in the private sector, the biggest challenge the Co-op needed to overcome was identifying which of their contractors were working inside of IR35. These were the contracts which posed a potential compliance risk ahead of the legislation roll-out. With the diverse nature and scale of the business, the group’s contingent workers came from multiple sources, so classifying each contractor individually added another level of complexity to the process.

The business also recognised that it faced a challenge when it came to retaining contractor talent in light of IR35 and wanted to approach the changes in a way that followed its core values around supporting and nurturing its people – whether that be permanent or temporary staff. Knowing that they did not want to take a blanket approach with their assessments, the Co-op wanted to give contingent colleagues the comfort of knowing that their case would be reviewed on a case by case basis, as well as being as transparent as possible throughout the process. The Co-op therefore needed a partner that could integrate itself into the business and develop an IR35 audit process that was fit for their organisation.


The Co-op approached Brookson Legal because they believed the team had the knowledge and specialist experience needed to carry out a thorough compliance programme, at a more commercially agreeable price than that of the top five consultancy houses offering similar services.

Before launching into a full audit of its contractor base, Brookson Legal supported the Co-op with its initial planning stages, helping the internal working group to understand how they should be approaching conversations with their contractor talent pool. Following the audit, which successfully identified workers as either red (inside of IR35), amber (borderline) or green (outside of IR35), Brookson then worked with the Co-op to identify the additional questions required to move amber contractors into either the red or green category.

Brookson One’s Umbrella solution then provided a way to transfer tax responsibility for those contractors who were found to be inside IR35, allowing the Co-op’s critical contractor talent to seamlessly continue working with minimum disruption and additional administration.

As the Co-op was keen to keep its contractors aware and engaged with the changes to IR35, it quickly set up a community group, holding monthly forums where its contractor workforce could come together and ask broad questions about the process and legislation. Brookson joined these sessions, supporting the team in answering any of the more complex and/or law-based questions. 


Brookson Legal’s initial contractor audit found that around 28 per cent of Co-op’s contractors could be classed as inside IR35, identifying the contracts that needed to be reviewed in order for those workers to remain compliant moving forward.

Just two per cent of the Co-op’s contractor workforce decided to look for an alternative contract due to concerns around IR35, and this action was taken regardless of the assessment outcome. The high retention levels are testament to the level of transparency shown throughout the process, with the Co-op and Brookson Legal team working together to ensure that workers felt well-informed and engaged with the changes.

Despite the postponement of IR35, the Co-op now has the templates, process and approach in place to ensure compliance when the time comes. The gift of time has also helped them recognise that they needed to spend more time adapting their business as usual, for example making sure that hiring managers understand what type of engagement they are looking for in each contract, how they should hire and the do’s and don’ts around working with someone who is inside vs outside of the legislation.

Brookson Legal will remain in place to support the Co-op through this next phase of compliance, changing from a fixed priced advisory model to a retained strategic partner, advising the business with complex issues which could impact their contractor relationships, including Swedish Derogation.

Thanks to Brookson, the Co-op can continue with its goal to be a destination for talent – whether that be permanent or temporary. Its experts have given us the advice, expertise and bespoke guidance needed to navigate these complex law changes, which are made more difficult due to the nature and scale of our business. We now feel ready to tackle the challenge when the changes do take effect in 2021 and would advise others to take the time required to do a thorough job, ensuring both your stakeholders and contractors are engaged with the process and ultimately partnering with a third party who really understands your business and the approach that’s right for you.
Georgina Jones, Head of Contingent Workforce Management


Brookson Legal are a team of knowledgeable and experienced lawyers who specialise in IR35 and helping hirers of flexible workers comply with the law. Our unique combination of experience, expertise and credibility means that we are the obvious choice for hirers who want to assess their existing flexible workforce and get ready for April 2021, when changes in the Private Sector come into effect.