The Umbrella Companies Blog Archive: November 2009
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As you may or may not be aware the umbrella company industry is pretty competitive, it always has been. After 10 years you come to welcome the challenges and changes that the business throws at you. With the credit crunch things got tougher, but our numbers have continued to rise despite playing fair so we're pleased to be ahead of the game.

Just recently though things have gotten a little more intense with the competition feeling more one on one; whether we are or not is another matter. This has it's good and it's bad points, the good being that you try that little bit harder, and it forces you to look at your strengths and weaknesses, the bad being that it can be tempting to point out other companies bad points rather than our own good ones, we won't do it but the temptation is there.

One of the sticking points for contractors and agencies that keeps cropping up is price. As you're hopefully aware we take £22 per week, and have done since the umbrella companies started back in 2006 (if you can remember as far back as I can, we were charging £22 for our composite company service in 2001). £22 is beneath the market so you would assume this puts us in a pretty good position. Unfortunately this isn't always the case, and that's solely down to the fact we advertise our costs as a gross figure..

The gross fee is really the only fair representation as it's static. it's not going to change person to person, and it can't be manipulated to make it look better. Net fees are essentially just a gross fee minus the PAYE tax a person would have paid on that amount, so it's always lower (for a higher rate tax payer our net fee comes out at around £11.31). In addition due to the fact that people pay different amounts of tax it can fluctuate a fair amount making it just inaccurate.

It would be the easiest thing in the world for us to change the marketing stuff, but it would mean intentionally misleading our customers.

Hugo
@GabemUmbrella
20/11/2009

Each time a new consultation document comes along people always want to know one thing "What are we going to do about it?"

We'd love to give you an answer, but it's never as simple as that. The first problem is that we're dealing with a consultation document, so it's likely that the initial proposition will change (it certainly did with the MSC legislation, but I'll come back to that later), so a definitive answer is impossible. We will already have made our feelings known, either directly or through our advisors - people like KPMG and Alan Nolan of Aspire Business Partnership. Then it's a matter of waiting for feedback and planning for a variety of scenarios.

We're very lucky to have the advisors we do because their experience and as a result contacts keep us very well informed of what the general feeling is about any consultation that may affect you. It is only the general feeling though, ultimately we have to wait the same as everybody else until the consultation document is released to the public.

The Agency Workers Directive document has only recently been released, so Wole our resident lawyer and our advisors have been ploughing through it. I really don't envy them as it's 170 pages of legalese, but it's the only way to know where we stand. We should be able to let you know very soon how or if it will affect you.

The MSC legislation is a great example of how these things can change a lot over time. When it was first announced we responded to the document with our point of view, but at the same time started to plan ahead. When the consultation document was published there were some changes which we had to make. Then when the legislation was finally introduced there were even more changes. As you can see it's a fairly fluid process, but one that any company in our industry has to learn to cope with if they want to continue to be successful.

So if we seem reluctant to comment it's not because we haven't got anything to say, it's just that we don't want to mislead you.

Hugo
@GabemUmbrella
06/11/2009

Apologies for the lack of recent posts, we've been preparing for the Christmas rush and ensuring things go smoothly takes precedence. It's all sorted now and Normal Service will resume this Friday, kicking off with a Legal Bits from Susan - covering the Agency Workers Directive, and a blog post from me discussing the broad topic of legislation changes. As for today, we have a few Public Service announcements about the lead up to Christmas.

As you will no doubt have seen on our front page we have a new offer for workers returning to Gabem or joining us for the first time. All they have to do is receive 4 payments through us before Christmas and they will receive a £50 voucher from either: Amazon, Tescos, Marks & Spencers, John Lewis, or Homebase. So tell your friends, there isn't much time left.

Keeping with the Christmas Theme, this year rather than send out cards as we have done each year we're going to be donating money to 4 charities. We have settled on "The Lighthouse Club" The construction industy charity as one of the charities, but would be interested to hear of any charities you think we should include. We can't make any promises that we will choose your charity, but they will all be considered, what have you got to lose? Just get in touch by emailing as usual.

Last thing on the Christmas front, a lot of you will be taking time off in December and it would probably be an excellent time to take the Holiday pay you have accrued through us. If you take it when you have no other payments going through you'll get the added advantage of less tax being taken from it. Remember we want all holiday paid out before April, because it doesn't carry over to the next financial year, you'll lose it. Just call in and our customer services department will take care of it.

Finally for those of you going to the National Online Recruitment Awards tomorrow, we'll see you there, as Trudy our MD will be handing out the award for "Best Employment Advice Website". We're very happy to be involved and want to wish all those nominated the best of luck.

Hugo
@GabemUmbrella
04/11/2009