BBC Stops Using Personal Service Companies

24 January 2014

Some BBC presenters are facing pay cuts of up to 25% as the broadcaster makes them go onto the payroll after controversially employing them through personal service companies.

BBC is telling some of its most famous faces that they will have to accept a reduced salary in return for staff benefits such as holiday pay and pension contributions, the Telegraph reported.

The corporation was criticised by MPs and the media in 2013 for letting some of its staff to be paid through personal services companies, a legal way to reduce tax.

At the time, BBC CFO Zarin Patel told politicians that of 467 presenters, 148 are on long-term contracts through service companies and added that the broadcaster did not try to avoid tax.

The BBC began moving up to 100 of its stars onto staff contracts at the end of last year.

Staff who have been affected were informed by the corporation that negotiation starting points are a 13% pay cut if presenters agree to become employees with the statutory minimum conditions set down by law, or a 25% salary reduction if they want enhanced BBC terms.