Are you a Recruitment business worried about AWR?

8 June 2011

The Agency Workers Regulations come into force on 1st October 2011 meaning that any contractors you are currently placing who will have contracts beyond 24th December 2011 will be affected by the legislation.

The 24th December is the key date as it is the 12 week qualifying period after the 1st October.

The good news is at PayMatters we are here to help.

Did you know for example that if you place a contractor through an Umbrella Company and there is a comparable employee earning £15 per hour then the amount you would have to pay the Umbrella Company so that the contractor is no worse off would be £19.39??

This higher amount reflects the 12.07% benefit the comparable employee earns as a result of getting paid statutory holidays and also the costs that have to be deducted by the umbrella company (mainly employers National Insurance (NIC)).

This may sound like a big difference in rates but these are the costs the end client is saving by using a contractor rather than an employee so this pay differential should come as no surprise to them i.e. if they were employing the contractor direct they would have to pay holiday pay and employers NIC.

At PayMatters we can help police this for all new contractors you are placing. We have designed a simple "Equal Treatment" questionnaire that enables us to ensure that all new contracts we accept will ensure the contractor working through us is no worse off than a comparable employee (if one exists at the end client).

Please call us today on 0800 121 6513 if you are a Recruitment Consultant or Recruitment Agency and would like assistance regarding AWR.