Reply to: HELP, I'm new and think I have been overcharged

[Steven@Parasol]

I'm a little confused by the changes which have been made. I have been contracting now for a year with Parasol in the same post. Recently I worked longer hours than usual almost 10 hours more than I would usually work in a week however my pay was the exact same figure down to the penny as I would have gotten from working my regular hours. Also I know that I have expenses in my account which aren't being used.

I've contacted Parasol and they said the pay was less than expected because the extra hours I worked were fully taxed, which is understandable and also that PBA is tax deductable, however in my payslip I notice that no expenses have been applied to my pay to offset the tax I pay.

I have no idea why they have stopped applying my expenses and all the correspondence I have recieved from Parasol is a brief explanation of what items are taxed in my pay and advice to claim back my unpaid expenses from HMRC. I thought the reason I was paying parasol £27.50 per week was to take care of all of this for me. Apparently not.

Hi Truth

If you PM me your details or email me directly I'll look into this for you. my email is steven.proud@parasolgroup.co.uk

[Steven@Parasol]

You are lucky pal, I have been stung in the first month nearly £900 on employment costs. sent about 10 emails to parasol about it and they come back 2 days later with a chapter they have pasted out of some guidance document, no one has really justfied what employment costs are and how they are going to take this off me every month, they like to dress things up so it doesnt sound that bad, trust me £900 a month is bad.

someone said that its to cover for sick pay, as if im going to take the statatuory sick pay at that rate, give me my £900 back and i will use that if I need "sick pay".

still waiting on answers from them now, I keep dreaming.

Hi Skillmaster

Employment costs consist mainly of Employers’ National Insurance Contributions (NIC) but they also include amounts to cover your insurance costs, as well as enough funds in order to pay you should you be on sick leave or maternity leave etc.

The rate of Employer’s NIC is currently 13.8% of earnings above £136 per week.

At Parasol we calculate employment costs to be 13.8% of the invoice value we raise for your work, minus our margin and the NIC free amount of £136 per week. For example, if we raise an invoice for your work of £1,000 a week, the employment cost will be calculated as follows:

£1,000 - £27.50 Parasol margin - £136 NIC free allowance = £836.50



So in the example above the employment cost is £101.44

You can see the amounts we retain outlined in the ‘Pay in Detail’ section of your payslip. For anyone that was with us before we introduced the new payslips this would have been listed as Employers’ National Insurance on the actually slip.

When you get a minute can you email me your personal details to steven.proud@parasolgroup.co.uk please and include a couple of times when you are free today. I will make sure a senior member of our ops team gives you a call to go through this in more detail.

Hope that helps

[Truth]

I'm a little confused by the changes which have been made. I have been contracting now for a year with Parasol in the same post. Recently I worked longer hours than usual almost 10 hours more than I would usually work in a week however my pay was the exact same figure down to the penny as I would have gotten from working my regular hours. Also I know that I have expenses in my account which aren't being used.

I've contacted Parasol and they said the pay was less than expected because the extra hours I worked were fully taxed, which is understandable and also that PBA is tax deductable, however in my payslip I notice that no expenses have been applied to my pay to offset the tax I pay.

I have no idea why they have stopped applying my expenses and all the correspondence I have recieved from Parasol is a brief explanation of what items are taxed in my pay and advice to claim back my unpaid expenses from HMRC. I thought the reason I was paying parasol £27.50 per week was to take care of all of this for me. Apparently not.

[LisaContractorUmbrella]

You are lucky pal, I have been stung in the first month nearly £900 on employment costs. sent about 10 emails to parasol about it and they come back 2 days later with a chapter they have pasted out of some guidance document, no one has really justfied what employment costs are and how they are going to take this off me every month, they like to dress things up so it doesnt sound that bad, trust me £900 a month is bad.

someone said that its to cover for sick pay, as if im going to take the statatuory sick pay at that rate, give me my £900 back and i will use that if I need "sick pay".

still waiting on answers from them now, I keep dreaming.

Statutory sick pay, and maternity pay come to that, should be a cost to business and should not be deducted from the individual so that may be incorrect information that you have received - what was the guidance document you mentioned, HMR&C have millions of them

[skillmaster22]

Hidden Employment Costs

You are lucky pal, I have been stung in the first month nearly £900 on employment costs. sent about 10 emails to parasol about it and they come back 2 days later with a chapter they have pasted out of some guidance document, no one has really justfied what employment costs are and how they are going to take this off me every month, they like to dress things up so it doesnt sound that bad, trust me £900 a month is bad.

someone said that its to cover for sick pay, as if im going to take the statatuory sick pay at that rate, give me my £900 back and i will use that if I need "sick pay".

still waiting on answers from them now, I keep dreaming.

[LisaContractorUmbrella]

The only reason I have learned a little about AWR recently is that I have just completed a piece of consultancy work for a large client to implement changes to their procurement and HR departments to ensure compliance. This involved examining the impact of the regulations across the temporary workforce supply chain which included Client - Agency - Umbrella relationships, contracts and engagements in that space.

So quick question as its of interest to me.....Does your organisation make a deduction from the contract revenue you get from the agency and keep hold of it until it's due to the employee? I can't see what other option you'd have if an agency mandated the Swedish Derogation to you?

No we don't. And an agency cannot mandate SD - that is determined by the contract of employment that the umbrella company has in place. All compliant umbrella companies should operate under an overarching contract of employment and, as evidence of mutuality of obligation (as required by HMR&C - see Clarke v Oxfordshire Health Authority) they are required to make a provision for payment between assignments, a fundamental requirement within section 10. Essentially umbrella companies were already operating under SD long before the legislation was introduced - IMHO that is why section 10 was included.

[LottoPlayer]

Actually no, I think that this legislation is pretty unambiguous on this point to be honest

The only reason I have learned a little about AWR recently is that I have just completed a piece of consultancy work for a large client to implement changes to their procurement and HR departments to ensure compliance. This involved examining the impact of the regulations across the temporary workforce supply chain which included Client - Agency - Umbrella relationships, contracts and engagements in that space.

So quick question as its of interest to me.....Does your organisation make a deduction from the contract revenue you get from the agency and keep hold of it until it's due to the employee? I can't see what other option you'd have if an agency mandated the Swedish Derogation to you?

[LisaContractorUmbrella]

I know, I know....Its merely down to interpretation, and I don't disagree with you entirely. I'm sure the tribunals will start spitting some results out in 2013 to clarify for everyone!!

Actually no, I think that this legislation is pretty unambiguous on this point to be honest

[LottoPlayer]

Page 38 of the final guidance on AWR from BIS is headed up "Pay Between Assignments". The first paragraph:

"There is an exemption from equal provisions on pay (and holiday pay) where a TWA can offer an agency worker a permanent contract of employment and pay the agency worker between assignments i.e. during the periods when the are not working when there are no available suitable assignments for the Agency Worker"

I know, I know....Its merely down to interpretation, and I don't disagree with you entirely. I'm sure the tribunals will start spitting some results out in 2013 to clarify for everyone!!

[LisaContractorUmbrella]

I think you're agreeing with me there Lisa. That is as you rightly point just saying that the umbrella company cannot terminate the employment contract before they have fulfilled their obligations. However this is the only clause which mentions when the PBA should be paid. Therefore as long is it is paid before termination of the contract of employment, the obligation can be discharged as soon or as late as the Umbrella/Agency determine commercially viable without any risk or breaching R10.

I suppose if you could show me anywhere in R10 that states that the PBA has to be paid at the time between assignments then that might also settle it!

Also you need to consider that this legislation is designed to protect vulnerable and low paid agency workers. Not highly paid consultant and therefore its pretty self policing in my mind. As far as I understand, it isn't possible for any genuinely low paid guys to be included in any rolled up or advance PBA without the client or agency actually paying more as there isn't enough 'commission' available to represent as PBA.

You might be able to clarify that a little, being from an Umbrella.

Again. I'm not saying I agree or disagree with it........Its just how I see it.

Page 38 of the final guidance on AWR from BIS is headed up "Pay Between Assignments". The first paragraph:

"There is an exemption from equal provisions on pay (and holiday pay) where a TWA can offer an agency worker a permanent contract of employment and pay the agency worker between assignments i.e. during the periods when the are not working when there are no available suitable assignments for the Agency Worker"

[LottoPlayer]

That's just saying that the umbrella company cannot terminate the employment contract before they have fulfilled their obligations - you have to consider the difference between an assignment, between which payment must be made, and contract which is the overarching contract of employment.

I think you're agreeing with me there Lisa. That is as you rightly point just saying that the umbrella company cannot terminate the employment contract before they have fulfilled their obligations. However this is the only clause which mentions when the PBA should be paid. Therefore as long is it is paid before termination of the contract of employment, the obligation can be discharged as soon or as late as the Umbrella/Agency determine commercially viable without any risk or breaching R10.

I suppose if you could show me anywhere in R10 that states that the PBA has to be paid at the time between assignments then that might also settle it!

Also you need to consider that this legislation is designed to protect vulnerable and low paid agency workers. Not highly paid consultant and therefore its pretty self policing in my mind. As far as I understand, it isn't possible for any genuinely low paid guys to be included in any rolled up or advance PBA without the client or agency actually paying more as there isn't enough 'commission' available to represent as PBA.

You might be able to clarify that a little, being from an Umbrella.

Again. I'm not saying I agree or disagree with it........Its just how I see it.

[LisaContractorUmbrella]

Hi Lisa

This is the specific clause which can be interpreted to provision making payments during the contract.

(d)the temporary work agency does not terminate the contract of employment until it has complied with its obligations in sub-paragraph (c) for an aggregate of not less than four calendar weeks during the contract.

That's just saying that the umbrella company cannot terminate the employment contract before they have fulfilled their obligations - you have to consider the difference between an assignment, between which payment must be made, and contract which is the overarching contract of employment.

[rachael parasol]

The old Parasol payslip had the items
Parasol Administration ann Employers NI
these are now
Parasol Margin and Employment costs

I just can' t work out the Employment costs on my Payslip and at the moment I believe I have been overcharged by about £160.

Steven@Parasol if you read this can I take you up on the offer you made in your post (20th October 2011 10:09) "to go through this in more detail".

I've had the the calculation explanation in that post emailed to me twice, but I can't equate it to the Employment Costs in my payslip (and shouldn't the calculation be 13.8/100 anyway?).
Your post also says
"but they also include amounts to cover your insurance costs, as well as enough funds in order to pay you should you be on sick leave or maternity leave etc."

I can only assume theses are new charges, as they never showed up before or were included in the Parasol Administration fee (as it was then)

If so, can you just introduce new charges like that with out any notification? isn't that a change to the contract?

If your currently with Parasol could you check your Payslips and see if it adds up
If your thinking about joining Parasol, please use their Pay Calculator and make sure you understand the Employment Costs

Steven is on holiday for a few days, but please feel free to email me at rachael.kinsella@parasolgroup.co.uk or give me a call on 01925 645242 (my direct line). Also, you can phone the employee support team on 0844 875 0079.

[LottoPlayer]

BTW, I'm not saying I agree with it......Just that there isn't anything which states when the PBA element should be paid.

[LottoPlayer]

Would you mind quoting the provision within section 10 that allows for the deduction and advance repayment of PBA 'cos I can't see anything:

Permanent contracts providing for pay between assignments

10.—(1) To the extent to which it relates to pay, regulation 5 does not have effect in relation to an agency worker who has a permanent contract of employment with a temporary work agency if—

(a)the contract of employment was entered into before the beginning of the first assignment under that contract and includes terms and conditions in writing relating to—

(i)the minimum scale or rate of remuneration or the method of calculating remuneration,

(ii)the location or locations where the agency worker may be expected to work,

(iii)the expected hours of work during any assignment,

(iv)the maximum number of hours of work that the agency worker may be required to work each week during any assignment,

(v)the minimum hours of work per week that may be offered to the agency worker during any assignment provided that it is a minimum of at least one hour, and

(vi)the nature of the work that the agency worker may expect to be offered including any relevant requirements relating to qualifications or experience;

(b)the contract of employment contains a statement that the effect of entering into it is that the employee does not, during the currency of the contract, have any entitlement to the rights conferred by regulation 5 insofar as they relate to pay;

(c)during any period under the contract in which the agency worker is not working temporarily for and under the supervision and direction of a hirer but is available to do so—

(i)the temporary work agency takes reasonable steps to seek suitable work for the agency worker,

(ii)if suitable work is available, the temporary work agency offers the agency worker to be proposed to a hirer who is offering such work, and

(iii)the temporary work agency pays the agency worker a minimum amount of remuneration in respect of that period (“the minimum amount”); and

(d)the temporary work agency does not terminate the contract of employment until it has complied with its obligations in sub-paragraph (c) for an aggregate of not less than four calendar weeks during the contract.

(2) For work to be suitable for the purposes of paragraph (1)(c) the nature of the work, and the terms and conditions applicable to the agency worker whilst performing the work, must not differ from the nature of the work and the terms and conditions included in the contract of employment under paragraph (1)(a).

Hi Lisa

This is the specific clause which can be interpreted to provision making payments during the contract.

(d)the temporary work agency does not terminate the contract of employment until it has complied with its obligations in sub-paragraph (c) for an aggregate of not less than four calendar weeks during the contract.