Payment for temporary agency workers
Payment for temporary agency workers
Temporary agency workers are never paid directly by Essex County Council (ECC) or placed on ECC payroll; you should not enter into any engagement with a temporary agency worker whereby ECC pay them directly.
All temporary agency workers sourced directly are paid by Client Directs Ltd (CDL). CDL are a Matrix SCM owned company and facilitate engagement, payroll and billing in respect of temporary agency workers sourced directly. Agency workers represented by a third-party recruitment agency are paid by their recruitment agency, and Matrix SCM pay this recruitment agency and invoice ECC the total cost including the agency margin.
Payment to temporary agency workers or third-party agencies is processed by Matrix SCM using their provided technology (CR.Net). Submitting Timesheets on CR.Net is the responsibility of the temporary worker or representing agency. It is then the line manager’s responsibility to approve the timesheet on CR.Net.
Matrix run payroll on a weekly basis and will process payment and bill ECC accordingly.
When your temporary agency worker will be paid
Ultimately this will be down to CDL and Matrix SCM and the agreed arrangement between them and the temporary agency worker, however payment is usually made one week in arears, typically on a Friday as long as the following criteria is met:
- temporary agency workers have submitted their timesheet via CR.Net by COB on the Friday in which the work has been undertaken
- line managers have approved this timesheet by 12pm the following Tuesday
Should you or an agency worker need any support on the submission or approval of timesheets please contact the Resourcing team (PDF, 125 KB).
Pay approach
When raising your recruitment requisition, you will be asked to confirm the pay rate for your agency worker. Our Resourcing team can support you through this process. You can choose from:
- an hourly basis – this is most common for roles which have a clear permanent equivalent in the ECC structure and usually have a salary equivalent of less than £50k per annum
- a day rate basis – this is most common for specialist interim work where there is no permanent equivalent role in the ECC structure, or the equivalent role has a salary of £50k per annum and above
- a milestone/per assessment basis – this is most common where a specialist piece of deliverable work is to be undertaken and payment is based upon outputs. Should you wish to explore this route, the Resourcing team will support you to ensure that the role meets the requirements of this pay type and you will need to draft a full statement of work, outlining payment milestones, timescales, and deliverables
- a combination of the above, please speak to the Resourcing team should you think you need this option
Pay rates
Under Agency Worker Regulations (AWR) temporary agency workers have several protections, including the right to pay parity, which is applicable after completion of a 12 week qualifying period. This means that if the temporary role has a permanent equivalent in the ECC structure, the rate of pay received by the temporary agency worker must be at least equal to the salary that an equivalent permanent member of staff receives.
If there is no permanent equivalent role in the ECC structure the Resourcing team can support you to identify the appropriate pay range based on current market conditions.
£650+ per day pay rate
Any temporary agency worker or Ltd Company that you wish to engage on more than £650 per day, must have cabinet member and CLT approval before you enter the engagement. Please ensure this form is completed prior to engaging your chosen temporary agency worker and returned to your recruitment contact.
Payment method
A temporary agency worker can be paid in three ways:
- pay as you earn (PAYE) - this means statutory contributions such as tax and national insurance are deducted from the agency worker at source when they are paid. This is the by far the most common payment method for temporary agency workers and does not require approval by the Resourcing team. You are not able to agree any other method of payment, without approval by the Resourcing team
- PAYE Umbrella - (only FCSA compliant umbrella organisation may be used). This is where a temporary agency worker chooses to have their payments and deductions managed by a third-party umbrella organisation
- Ltd Company – this is where ECC engage an individual as a personal service company to supply services. For more on this subject please see the IR35 page.
Costs
The cost of a temporary agency worker will depend on the detail of the arrangement and the individual who you are engaging, the Resourcing team will confirm this to you when a placement is made. However, a hypothetical worked example is below to support your understanding of how your total cost maybe calculated:
Pay Rate: £15 per hour
WTR: £1.89 per hour
Apprentice Levy: £0.08 per hour
Employers NI: £1.77
Pension auto enrolment: £0.45 per hour
Payroll fee: £0.43 per hour
Agency fee (if applicable): Varies (6% - 18%)
Total charge: £19.62 per hour (+ agency fee if applicable)
Pay rate considerations
You must ensure you continue to extend equal pay to temporary agency workers, to their permanent equivalent counter parts. So, if the rate for the job increases for your permanent staff (for example, an annual pay award) you must inform the Resourcing team so that we can ensure the same is applied to relevant temporary agency workers.
Annual disclosure of statutory accounts
Any temporary agency worker or Ltd Company who costs ECC more than £150k in any financial year must be disclosed in our annual statutory accounts. This will include the name of the temporary agency worker (even if operating as a Ltd Company) and their engagement title. It is important to remember that this is based on the full cost of the temporary agency worker or their services to ECC, not the payment to the agency worker, or their Ltd Company so will include any on costs, agency fees and expenses. Should you suspect the cost of a temporary agency worker’s engagement will exceed this amount, you must ensure the temporary agency worker is made aware of this requirement as it is a legal obligation for ECC.
Memorandum of Cooperation
For qualified social worker roles, ECC is a member of the Memorandum of Cooperation (MoC). This agreement is made between the authorities in the East of England and sets out pay rates for qualified social work positions, to maintain pay parity across the region for temporary agency social workers. If you are recruiting to a position in Adult’s or Children’s which is in scope of the MoC, your resourcing consultant will advise you of the pay rates and support you through this process, including asking for exemption if required.