Agency News:

Good news for Gabem's contractors and agency clients-Gabem's high standards are commended at a time when HMRC is scrutinising dispensations closely.

Late last year, the Government made clear its intention to clamp down on companies that were not complying with regulations while providing umbrella companies or contract options to temporary and self-employed workers. To be sure that it complies with legislation, Gabem Management Limited took the unusual step of inviting HMRC to check its policies and procedures. As a result, HMRC commended Gabem’s operations and granted the company expenses dispensation.

[Read full entry for: GABEM WINS HMRC EXPENSES DISPENSATION]

With permanent job vacancies at their lowest levels since records began, temporary positions are fast becoming the norm. But it's not all plain sailing for agencies or workers.

In this significant downturn, short-term contracts are a lifeline for workers and employers alike. In tough times, companies need the flexibility to adjust their workforce to changing levels of business, so would like fewer people on the permanent payroll. Workers may operate under different contracts appropriate to each work assignment, but will always want to maximise the money they take home. These are matters of survival. And when the country starts to climb out of recession, as it surely will, then businesses will need fast and flexible access to labour to meet rising business demands.

Navigating through the legislation

Beneath these simple truths are the complex undercurrents of employment legislation-introduced with the aim of eradicating 'bogus' self-employment. Compliance is increasingly under scrutiny, with the Government recently stating its intention to crack down on non-compliant operations.

[Read full entry for: Navigating through the legislation]

With HMRC focusing on 'non-compliant' operators, it's never been more important to work with a compliant partner. Gabem's recent re-structuring made sure that compliance continues to be at the forefront of operations-lifting the worry from agencies and end-clients.

In the 2008 Pre-Budget Report, the Government expressed concern about providers of umbrella and other payroll services that fail to comply with legislation. HMRC made clear its intention to step up compliance visits, to litigate where appropriate, and where successful, to recover the PAYE and NI debt. If the defendant is unable to pay, the risk may be passed on (through the transfer of debt provisions) to third parties, including providers of such companies, their associates, and others who have encouraged, facilitated or otherwise been involved in the process.

In Gabem's view, the reputation of the industry is tarnished by unscrupulous providers that exploit workers through dubious practices-for example by failing to deduct correct tax on their behalf, abusing expense dispensations, or operating off-shore. Enforcing compliance can only serve to raise the professional level of the industry, since such companies put their contractors and agencies at risk. However, it also means that contractors and agencies must be confident that their supply chain is compliant.

When the time was right to widen our offerings last year, not only did we work through every element of the new structure with professional advisers, but we also invited specialists from HMRC to review our policies, processes and procedures on site. They complimented us on the robustness of our expenses system, which in turn provides our clients with confidence that our offerings are compliant.

[Read full entry for: Keeping Agencies Safe]

With costs under the microscope, agencies want to optimise the value of their consultants. If business partners can take on some of the day-to-day interaction with the agency's workers, consultants are freed up to do the more profitable work.

Consultants' time is at a premium, so every contact with the agency's workers that can be handled by the service provider reduces the hassle for consultants-leaving them more time to generate new business. This makes sense, because providers are set up with trained people to handle a whole range of enquiries, to update personal details, pay the right money into the right account, and maintain data confidentiality.

However, agencies have to be sure that the tasks are in safe hands. In fact, if agencies produced a 'wish list' for its service providers, it might look like this:

[Read full entry for: Taking Care of the Details]