In an earlier post we discussed the importance of Due Diligence for recruitment agencies when engaging with Umbrella Companies. Previously, we discussed the steps involving choosing a preferred supplier and/or an approved supplier, and what accreditation standards recruitment agents should be aware of. In addition to these checks, financial considerations must also be taken into account.
Financial Information
The first step is to request copies of payslips and pay reports from each umbrella company you are considering. Establishing the baseline provides the information you can check against when carrying out your future due diligence checks. This will help you in establishing whether things look like they should. Clarification from accreditation standards bodies such as Professional Passport can be sought if uncertainty around the format exists.
Terms of Engagement
It’s important to establish whether the umbrella company is dealing fairly with its contractors. Ask for details of its terms of engagement, particularly with regard to pay, holiday leave, benefits, sick pay, maternity/paternity leave, pension contributions, Working Time Regulations, Agency Worker Regulations and Conduct Regulations. Again, if clarity is required around these matters, accreditation bodies such as Professional Passport can advise on any queries.
Insurance
Does the potential umbrella company have adequate insurance cover? Check whether the company is actually named on the insurance certificate, in order to meet your own contractual obligations.
Bank Statements
Request a copy of the umbrella company’s bank statement – it will reveal a great deal more than just its financial situation. Establish whether the company name on the statement matches exactly the information lodged with Companies House. If it does not, or if you encounter a ‘could match’ message when adding companies to your own banking system, it could mean that further checks are required.
Online Presence
It’s always worth checking the online presence of any umbrella companies under consideration, in conjunction with your other checks. For example, you may seek out review sites, where feedback can indicate their presence across the industry. Contractor forums, where robust discussions can reveal insight around companies, are also useful for supporting your further checks.
If you are looking to work with an Umbrella company, visit the Approved Providers list from Professional Passport, the UK’s largest independent assessor of payment intermediary compliance. If you are an agency or organisation using or looking to engage with an umbrella company and need advice, please contact info@professionalpassport.com.
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