Reply to: How long it takes to get a P45?

[LisaContractorUmbrella]

I would be eager to know however.... Nevertheless, this info will definitely change my view on determining/negotiating the hourly rate when it comes to an umbrella contract. Having said that, I have already made my calculations to have it handy when an offer comes along. ;-)

Thanks for the info anyway - it is most certainly useful!

You're welcome - glad to help

[curious]

I couldn't tell you why but yep I would agree it's pretty unequivocal

I would be eager to know however.... Nevertheless, this info will definitely change my view on determining/negotiating the hourly rate when it comes to an umbrella contract. Having said that, I have already made my calculations to have it handy when an offer comes along. ;-)

Thanks for the info anyway - it is most certainly useful!

[LisaContractorUmbrella]

That is pretty unequivocal - so how come they still do it?

I thought the spotlight was on compliance at the moment so decent Umbrellas (like yourself naturally) could distance themselves from the rogue operators?

I couldn't tell you why but yep I would agree it's pretty unequivocal

[VelcroPower]

That is pretty unequivocal - so how come they still do it?

I thought the spotlight was on compliance at the moment so decent Umbrellas (like yourself naturally) could distance themselves from the rogue operators?

[LisaContractorUmbrella]

Thanks again Lisa

Don't quite a few Umbrellas (including some of the bigger ones) roll up holiday pay?

They do yes and shouldn't https://www.gov.uk/holiday-entitleme...pay-the-basics

[VelcroPower]

The Swedish Derogation was introduced as part of the AWR as it has the effect of an OAC i.e. the worker is employed under a contract and there is full continuity of employment with all the rights that go with it. The point of any kind of PBA is to maintain mutuality of obligation across the whole of the employment, even when there is not any work available for the employee - to pay it as part of salary (as you would with rolled up holiday pay which is also unlawful) sort of defeats the object

Thanks again Lisa

Don't quite a few Umbrellas (including some of the bigger ones) roll up holiday pay?

[LisaContractorUmbrella]

Thanks Lisa - That's the OAC PBA though looking at it.

Is that not different to the Swedish Derogation element of PBA whereby you are entitled to 50% of your average pay for a minimum of 4 weeks etc to avoid having to match comparator rates under AWR?

The Swedish Derogation was introduced as part of the AWR as it has the effect of an OAC i.e. the worker is employed under a contract and there is full continuity of employment with all the rights that go with it. The point of any kind of PBA is to maintain mutuality of obligation across the whole of the employment, even when there is not any work available for the employee - to pay it as part of salary (as you would with rolled up holiday pay which is also unlawful) sort of defeats the object

[VelcroPower]

ESM2087 - Agency and temporary workers: overarching contracts of employment - guaranteed minimum hours

Thanks Lisa - That's the OAC PBA though looking at it.

Is that not different to the Swedish Derogation element of PBA whereby you are entitled to 50% of your average pay for a minimum of 4 weeks etc to avoid having to match comparator rates under AWR?

[LisaContractorUmbrella]

Which particular guidance out of interest?

ESM2087 - Agency and temporary workers: overarching contracts of employment - guaranteed minimum hours

[VelcroPower]

Pay between assignments should be just that - it should not be advanced if the umbrella company is to be compliant with HMRC guidance

Which particular guidance out of interest?

[LisaContractorUmbrella]

Yes indeed, I had to acknowledge this at the time - that is why I said the whole idea was ridiculous. The Government has brought this to law, so employees can gain a little extra fund for retirement by getting employers to contribute into this. However they are losing their original point by forcing umbrellas to operate this pension auto-enrolment. They clearly will not pay you extra as your wages are not coming from them originally. It is a completely different layout, and it is a real shame that the Government has not ruled them out from this rule... What is the use? So I can pay for my own pension (doubled amount) in each month??? Or just opt in because I am forced to then I can quickly opt out and claim my money back??? Let's not forget the extra hassle - which could be avoidable - on each part. Whooppie.... Maybe we should start a petition....

I couldn't agree more - the extra workload this has brought for umbrella companies is huge I'll sign your petition quite happily

[curious]

Umbrella companies, as with any other employer, have to operate pensions auto-enrolment by law Automatic Enrolment | The Pensions Advisory Service. As the name would suggest, there is no choice for the employer but to enrole their staff into a pension scheme - there is then an option for the workers to opt-out but there are rules and regs surrounding this process Opting Out | The Pensions Regulator. You should have had something from the umbrella company or their pensions provider explaining all this.

Yes indeed, I had to acknowledge this at the time - that is why I said the whole idea was ridiculous. The Government has brought this to law, so employees can gain a little extra fund for retirement by getting employers to contribute into this. However they are losing their original point by forcing umbrellas to operate this pension auto-enrolment. They clearly will not pay you extra as your wages are not coming from them originally. It is a completely different layout, and it is a real shame that the Government has not ruled them out from this rule... What is the use? So I can pay for my own pension (doubled amount) in each month??? Or just opt in because I am forced to then I can quickly opt out and claim my money back??? Let's not forget the extra hassle - which could be avoidable - on each part. Whooppie.... Maybe we should start a petition....

[LisaContractorUmbrella]

The net deduction should be the same as the refund (your employee element) the gross (employer) amount should also be the same but may net down to a different amount depending on many factors including your tax & NIC allowances for that period. If the employee refund is exactly the same and the gross employer refund matches the same as what was deducted initially then you've not suffered any loss.

On the subject of your P45 it's possible that you signed up to a Swedish Derogation contract of employment and were "advanced" some money as Pay Between Assignments. In order to ensure there is no liability on either side for that advance the umbrella company will state that you worked off that period of "advance" and *then* issue your P45. Did you have anything advanced on your payslip?

Pay between assignments should be just that - it should not be advanced if the umbrella company is to be compliant with HMRC guidance

[curious]

That's right I'm afraid - the pensions legislations state that providing you meet the qualifying criteria the Umbrella Company are compelled to automatically enrol you. You can't pre-emptively opt out - you can only opt out once you have been enrolled.



The money has to come from somewhere for the employer contributions - the only money the Umbrella company makes is the margin retention. If they had to fork out for everyone's employer pension contributions from their own pocket you'd see higher margins to cover that cost.



The net deduction should be the same as the refund (your employee element) the gross (employer) amount should also be the same but may net down to a different amount depending on many factors including your tax & NIC allowances for that period. If the employee refund is exactly the same and the gross employer refund matches the same as what was deducted initially then you've not suffered any loss.

On the subject of your P45 it's possible that you signed up to a Swedish Derogation contract of employment and were "advanced" some money as Pay Between Assignments. In order to ensure there is no liability on either side for that advance the umbrella company will state that you worked off that period of "advance" and *then* issue your P45. Did you have anything advanced on your payslip?

Thanks for the info about Swedish Derogation - I did not know about that, however I did not have anything advanced on my payslip, but it is useful to know about this.

[curious]

Pension contributions are deducted without tax. If you get a refund it will have the tax applied it before you get your money.

Thanks, it was not really the point... I was talking about a mistake made within the calculations (have never assumed that I would not pay tax on it....).