Agency social workers – finding the umbrella company for you

Top 10 tips to consider when looking for an umbrella company

Crawford Temple outlines what agency social workers should look out for in an umbrella company so they can avoid any problems. Crawford is the CEO and founder of Professional Passport, the largest independent assessor of payment intermediary compliance.

As a result of new government legislation that came into effect in the public sector in 2017 and into the private sector last year, many social workers who used to work through their own limited companies to provide their services may have been forced to review their options. Today, many more are now working through an umbrella company.

Umbrella companies can be confusing and there is a lot of negative publicity and misinformation that gives them a bad name. However, there are many compliant umbrella companies out there in the market. Here are some top tips on what to think about when looking for the right one;

  1. There is no single definition of an umbrella company and the sector is currently unregulated. Most umbrellas are compliant with employment and tax law, but some are not so workers need to be on their guard.
  2. Talk to your agency if you feel very strongly that you do not want to engage with an umbrella company. However, be aware that not all agencies run PAYE schemes themselves anymore. Be aware that some agencies receive incentives to encourage you to sign up to a particular umbrella company.
  3. Do your homework and think carefully before joining up to any umbrella. Many agencies have an approved and/or preferred supplier list of umbrella firms they would recommend. But check them out for yourself.
  4. Be alert to the perks that some umbrella companies advertise to entice you. Some of these may be worth very little or not be relevant to you so weigh up your priorities before choosing an umbrella. You should also make sure you do not get caught up with problematic ‘mini’ umbrella companies.
  5. Ask your agency for both their PAYE rate and limited company rate when considering a potential assignment.
  6. Check how the umbrella company will deal with your holiday pay. Ask them to confirm the circumstances in which you may lose the holiday pay. Under new legislation, workers should not lose any holiday pay.
  7. If you leave an umbrella, ask them to confirm that all outstanding holiday pay will be paid to you with your final payment
  8. Be wary of any umbrella that says they can still process home to work travel expenses.
  9. Be extra vigilant about being offered or given payment in the form of loans, grants or advances. It is likely to be disguised remuneration and workers will be penalised by HMRC for unpaid taxes. One way to monitor your earnings is by signing up for a Personal Tax Account with HMRC.
  10. With a Personal Tax Account, contractors can check that the earnings that are reported on their payslip are the same as those reported to HMRC, as the information is regularly updated following Real Time Information (RTI) submissions.

You will also find many useful articles and videos on the Professional Passport website in the Hot Topics section.

Why not consider Social Work Employment Services?

  • An umbrella company created for social workers by social workers
  • Let us show you the Net Pay you could be taking home when you join Social Work Employment Services with the umbrella company calculator and download an example payslip (including holiday pay).
  • The social work umbrella service is ethically committed to a fair price and will manage all your employment and payroll obligations for a set fee. For just £15 per week, as a Social Work Employment Services agency social worker you will be fully insured and compliant

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