Can agency force me to use their PSL umbrellas instead of my preferred one?

[PaulGardner]

Hi, I've been offered a contract that I would like to accept but a major sticking point is that the agency insists on me choosing an umbrella company from their list and won't let me use my existing umbrella company, despite it being FCSA-accredited.

I have seen it claimed online that agencies doing this may be in breach of Regulation 5 The Conduct of Employment Agencies and Employment Businesses Regulations 2003. Withdrawing the offer because I insist on choosing the umbrella company may also be in breach of Regulation 5, according to the information I've been given. However, I am awaiting proper legal advice on both of those points.

Does anyone on the forum have any experience of standing their ground on this issue and what was the outcome?

In the meantime, the five umbrella companies on the list are Paystream, JSA, ICS, Giant and Brookson. All of them have the usual invited positive ratings on Trustpilot, but the negative reviews of each paint a very different picture of course and I'm inclined to find them more credible as a strong pattern seems to emerge among them - typically having to speak to a different person each time, margins changing from one week to the next, difficulty getting through to anyone at all, calls and emails not returned etc. These hardly inspire me with confidence, especially when all of them charge nearly double the margin that my current umbrella does.

[WTFH]

Hi Paul,
Welcome to the forum.

Who is your preferred umbrella and how long have you worked with them?
Who is the agency?
What response did they give you when you gave them the name of the umbrella you wanted to use?

[PaulGardner]

Hi Prof.

My preferred umbrella is Fair Pay Services Ltd and I have used them since last November. I have been with various end clients over that time and have had issues with none of them.

The agency is Modis, which is apparently a subsidiary of Adecco.

I was referred to the agency's managing consultant and she was adamant that she was powerless to budge on the issue. I pointed out that my current umbrella is FCSA-accredited but that makes no difference to them.

[eek]

There is nothing at the moment stopping an agency insisting on you using their chosen PSL umbrella lists because there is a risk that even an FCSA umbrella has problems (see the Unified Payroll closure a few weeks ago, they were both FCSA and Professional Passport certified).

And as there is nothing on the market (yet) that would give a sane agency any comfort that your preferred umbrella is actually honest, it's easy to see why a sane agency will insist on from our list or continue looking elsewhere for another contract.

So I know it's not what you want to hear but you need to pick one of that dire list to choose from (I wouldn't go for giant though after their issues) but it says something when I look at the list and go Brookson may not be that bad.

[northernladuk]

You can ask to see if they are willing to change but why would you think you can pick any if there is a preferred supplier list? That's kind of the point of a PSL. The agency will have done some diligence on them and got them on board so will be unwilling to pay/spend time on doing the same to others. It's likely there are kickbacks going on which make it even less likely they'll flex.

[eek]

Hi Prof.

My preferred umbrella is Fair Pay Services Ltd and I have used them since last November. I have been with various end clients over that time and have had issues with none of them.

The agency is Modis, which is apparently a subsidiary of Adecco.

I was referred to the agency's managing consultant and she was adamant that she was powerless to budge on the issue. I pointed out that my current umbrella is FCSA-accredited but that makes no difference to them.

There are 2 possibilities here

1) kick backs are involved to get on to the PSL (I don't know if there are and it doesn't feel like the sort of thing Adecco would do but I'll check later).
2) If you think an umbrella firm needs to charge approximately £100 a month for the services they provide (remember that's what the ones on your list charge) Fair Pay charging £15 a week / £30 a month could be seen to be a risk.

[Paralytic]

You can ask to see if they are willing to change but why would you think you can pick any if there is a preferred supplier list? That's kind of the point of a PSL. The agency will have done some diligence on them and got them on board so will be unwilling to pay/spend time on doing the same to others. It's likely there are kickbacks going on which make it even less likely they'll flex.

Perhaps pedantic, but the P stands for preferred, implying other options may be acceptable. It should be renamed as a Mandatory Supplier List.

[northernladuk]

Perhaps pedantic, but the P stands for preferred, implying other options may be acceptable. It should be renamed as a Mandatory Supplier List.

It is a little as the are preferred as they have been through some kind of on boarding process. Co's can deviate from it but it's a right ball ache and not something they will usually do just because a contractor doesn't like the list they have.

[PaulGardner]

There are 2 possibilities here

1) kick backs are involved to get on to the PSL (I don't know if there are and it doesn't feel like the sort of thing Adecco would do but I'll check later).
2) If you think an umbrella firm needs to charge approximately £100 a month for the services they provide (remember that's what the ones on your list charge) Fair Pay charging £15 a week / £30 a month could be seen to be a risk.

That is certainly my big concern about these lists. Some agencies do insist on them, whereas others do let you use your own choice of umbrella company as long as it's FCSA-approved.

I think refusing the contract on the grounds of not wanting to use one of those companies would be cutting off my nose to spite my face, though. I have other potential offers in the pipeline but I definitely want to work with this end client, so I think I'll just have to grit my teeth and pick one of those five.

What I do like about FPS besides the lower margin is that I don't have to speak to a different person every single time I call. In fact the md has gone the extra mile for me on several occasions. I just can't see one of these bigger corporate operations being as helpful.

[lucyclarityumbrella]

Can't do anything with regards to the margin, but might be worth a chat will message you.