Industry bodies IWORK and Contractor Voice have teamed up to spread a message to contractors and supply chain bodies. With reports of a small number of umbrella companies unethically retaining workers’ holiday pay, the two industry bodies are encouraging compliant umbrellas to “publicly pledge to always give workers what is owed to them – using the hashtags #wegiveyouyours and #fairholiday”. Keep reading for more information.
Umbrella companies and holiday pay
Umbrella companies should be processing holiday pay for workers. Holiday pay is calculated at 12.07% of the assignment rate and should be administered each time a payment to a worker is made. To check this is happening, review your umbrella company payslip and look out for “holiday pay”.
Some umbrella companies will allow you to accrue your holiday pay and have it paid in a lump sum later. If this is how you would like your holiday pay to be processed, have a word with your umbrella before registering – to check if it’s an option.
With the above in mind, why has holiday pay caused so much controversy within the umbrella company marketplace? We’ll try and explain it within a few sentences.
Holiday pay legally belongs to the worker and should be paid by umbrellas without any confusion or delay. However, it’s been reported that a few unscrupulous umbrella companies have been retaining unclaimed holiday pay for themselves – an act that will significantly boost an umbrella company’s profits and leave temporary workers out of pocket. Any umbrella that has done this has acted unethically – assuming they have not reached out to workers and tried to alert them about the holiday pay they’ve accrued.
If you use an umbrella or you’re tempted to use one in the future, don’t let holiday pay put you off. You must understand how it should be processed to ensure you’re not left out of pocket. The new campaign from IWORK and Contractor Voice is designed to do precisely that – raise awareness of holiday pay to ensure workers are not out of pocket and that umbrellas do not profit unethically.
A message for umbrella companies and recruitment agencies
In an article published on IWORK’s website, Julia Kermode, CEO at IWORK, reaches out to umbrella companies and recruitment agencies and asks them to share that they process holiday pay fairly with hashtags on social media:
“We would love your help in spreading awareness of holiday entitlement, so please follow us on social media, like and share our posts. If you are an umbrella or recruitment agency you can respond to our posts and publicly pledge to always give workers what is owed to them – using the hashtags #wegiveyouyours and #fairholiday to show your support. Both of the umbrella industry accreditations, FCSA and Professional Passport, have already confirmed they support our campaign, so why not add your voice too.”
Any initiative designed to help protect temporary workers and ensure they’re paid fairly is going to have a positive impact on the industry and the team at umbrellacompanies.org.uk is fully behind the IWORK and Contractor Voice campaign.
Like temporary workers, umbrella contractors are also missing out on their rightfully earned paid holiday!
Help us spread the word and ensure #yougetyours📢@ContractorVoice#Doyougetyours #paidholiday #temporaryworker #umbrellacontractor pic.twitter.com/bkZmbDTEWw— IWORK (@IWORKcouk) August 2, 2022
Contractors and freelancers
If you’re using an umbrella company for your payroll or considering it, you must understand how holiday pay works to ensure it is processed fairly and reaches your bank account. While most umbrella companies process holiday pay transparently and efficiently, some have tainted the sector’s reputation. If you believe you’re owed holiday pay from an umbrella company and they are not acting ethically, report them to their accreditation body (if they have one), and consider contacting HMRC. You can also contact Contractor Voice via their website because they’re actively encouraging workers who think they’re owed holiday pay to get in contact for assistance.
Umbrella companies
If you’re an umbrella that values compliance, make sure your internal processes ensure that every worker receives holiday pay fairly. Assuming you are compliant and wish to spread the word, please use the hashtags #wegiveyouyours and #fairholiday.
More information about IWORK
IWORK is fairly new on the scene, but it’s an organisation you should pay attention to. Here is what the IWORK website states regarding the company:
“Founded by Julia Kermode, Independent Work Ltd brings together all the different ways that people work independently in the UK – from temporary agency workers, to freelancers, contractors, self-employed or gig economy workers, these are all increasingly important to the UK’s economy.”
Julia Kermode is on a mission to help contingent workers be treated fairly by employers and the government, whilst making it far easier to notice the difference between fact and fiction in relation to claims made by stakeholders within the sector. IWORK is well worth a follow, and you should definitely sign up for the IWORK newsletter at your earliest convenience.
IWORK feature in our article: 10 Organisations Every Contractor And Freelancer Should Be Following.
More information about Contractor Voice
Founded by Jacob Bellas, a contractor, Contractor Voice is a site committed to helping temporary workers receive their fair share of holiday pay. The following snippet is taken from the Contractor Voice website:
“Our initial focus is directed towards the fact that tens of thousands of contractors each year are not being paid the Holiday Pay they are entitled to. Temporary contractors are, in the vast majority of roles, temporary employees, so they are entitled to Holiday Pay and the same legal rights just like traditional employees.
The BBC Radio 4 Moneybox programme highlighted earlier this year that the practice of withholding holiday pay is still happening and is widespread across the UK, with umbrellas and agencies being involved in the malpractice.
Around 2 million workers each year are not receiving an eye watering £3 billion per year in Holiday Pay, which is being pocketed by companies and treated as additional income.
The government has done nothing at all to stop this, Contractor Voice was made to increase awareness and lobby for a change in the law so that this immoral practice is stopped and to force the companies that have been involved in withholding Holiday Pay to pay what should have been paid.”
Word of the campaign is spreading
On 16th August, IWORK reported on Twitter that Umbrella Leaders Association were also backing the campaign to spread the word about the fair handling of holiday pay for temporary workers.
Top 10 umbrella companies
If you’re currently on the lookout for a new and compliant umbrella company, or you want to switch away from your current provider – we can help. To make your search easier, we’ve collated a list of our top 10 umbrella companies, and they’re accredited by the Freelancer and Contractor Services Association (FCSA) or Professional Passport. It’s also worth noting that some of our top 10 umbrellas are currently running special promotions. Please check them out.
