Month: April 2018

No one can deny that the use of agency workers is part of the fabric of employment in the UK. The current figure is 865,000 agency workers and this is expected to rise to 1 million by 2020 according to data from an ONS Labour Force Survey.

As a business using agency workers you need to understand that when an agency worker is on assignment with you they are temporarily under the supervision or direction of the hiring organisation, that means your organisation, but they are still employed by their agency.

We tend to use the word ‘agency’ as a catch-all term but the term ‘agency’ can apply to temporary work agencies, recruitment agencies, staffing companies and entertainment and/or modelling agencies.

As an organisation using personnel from agencies you need to understand their rights and your responsibilities to provide a good and productive working environment.

Did you know an agency worker can have one of three main types of employment status which means they have different rights?  They can be an employee, a worker or self-employed.

Workers have employment rights such as paid holiday and the National Minimum Wage, but they normally have few responsibilities to the agency and can normally decline work offered to them.  An agency worker who is classed as an employee is usually employed under a contract of service.  They have additional rights such as getting paid if work isn’t available, but they have more obligations to the agency than people classed as workers.  Such as they might have to accept work offered to them and be available for a minimum amount of hours each week.

Agency workers who are genuinely self-employed are often referred to as contractors.  They don’t have any employment rights, but have even fewer commitments to the agency, such as they can send someone in their place to do the agency work.

As a business, organisation, school or college using agency workers it is prudent for you to know workers employment status with their agency and how this could impact upon you and your reason for needing agency staff.

Our head office is in Birmingham, but we have clients all over the UK who rely on us for help and advice on all matters related to Payroll and HR please get in touch.

Following the death of a DPD driver the BBC has reported that DPD is the first parcel carrier to recognise the need to improve the way they work and offer drivers new contracts. The carrier had been under scrutiny after work pressures were blamed for the death.

DPD’s Chief Executive said that while their self-employed franchise scheme had benefited thousands of drivers over the past 20 years, it hadn’t moved with the times and needed updating.

DPD is reportedly offering 6,000 drivers the choice of remaining self-employed or moving to the new contract, and the company is paying for advisers to help drivers make their decision.

The Government appointed former Labour policy adviser Matthew Taylor to look at what has been termed the ‘gig economy’ and published their response to the Taylor review on Modern Working Practices in February 2018. Key among the response was “For the first time, the government will be accountable for good quality work as well as quantity of jobs – a key ambition of the UK’s Industrial Strategy.”

For advice on sick pay, holiday pay and all matters related to Payroll please get in touch and one of our helpful advisers at All Payrolls Birmingham Head Office will be only too pleased to help you.

The Low Incomes Tax Reform Group (LITRG) has highlighted inequalities with Auto Enrolment depending upon what type of scheme you are enrolled in and if you are low paid. Especially in light of the increase in contributions employees will be required to make from this month (April 2018).

LITG Chair, Anne Fairpo said “The increase in contribution rates makes auto enrolment a much bigger consideration for the lowest paid. The fact that many people on low incomes cannot obtain tax relief is a huge disincentive – it makes auto enrolment effectively 20% more expensive for them.”

Workers affected are squeezed by:

1. Earning over £10,000 (which is needed to trigger auto enrolment)
2. Earning below the income tax threshold (which is currently £11,500)
3. Earning at or near the minimum wage, meaning they can’t salary sacrifice to save 12% National Insurance

There are broadly speaking two kinds of auto enrolment scheme a ‘net pay’ scheme or a ‘relief at source’ scheme. On a ‘net pay’ scheme you cannot claim tax relief.  On a ‘relief at source’ scheme you can!

The LITRG are suggesting that HMRC could see from PAYE real-time data if pensions contributions have been made into a ‘net pay’ scheme (so no tax relief has been claimed), and the Government could pay the tax relief they have missed out on into their pension. This would mean the individuals wouldn’t lose out.

If you’ve got a question about any aspect of payroll or auto enrolment and pensions reporting contact one of our experienced team.  All Payrolls office is in Birmingham but we work with clients right across the UK. We are always just a phone call away.

For employees who have opted-in to an Auto Enrolment pension they and their employers will be paying into them at higher levels from this month.

April 2018 sees the contribution rates rise from 1% paid by the employee and 1% paid by the employer to 3% paid by the employee and 2% paid by the employer. These are the minimum contribution levels.

This increase has led to concerns that there could be a sharp rise in people opting-out of their auto enrolment pensions as the increase impacts their take-home pay. But this is not the whole story.  The auto enrolment pension levels are due to rise again in April 2019.  The total minimum contribution will be 8%, with 5% contributed from employees and 3% coming from employers.

Nine million workers have been paying the minimum into their pension and to date the drop-out rates have been less than expected at 10% of employees eligible for auto enrolment opting-out. However, the government is predicting the rate of opting-out to increase from the current figure of 10% to 22% after April 2018, and 27.5% after April 2019.

Former Pensions Minister, Sir Steve Webb thinks that people will take the increase in contributions “in their stride” as their overall take-home income rises. The national living wage will rise by 4.4% also in April 2018.

If you’ve got a question about any aspect of payroll or need help on HR, including shared parental leave, contact one of our experienced team at All Payrolls based in Birmingham. We are just a phone call away.