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UK - Recruiters facing admin ‘double whammy’ in 2015

29 December 2014

Staffing firms that place contractors and temporary workers will be hit by a double whammy of fresh administrative duties in the New Year, according to Parasol, the UK-based provider of contractor and freelancer employment services.

The company believes legislation around pensions and false self-employment has the potential to hamper recruiters’ growth in 2015. Jeff Blakemore, a director at Parasol, said: “Many recruitment firms operating their own PAYE scheme for contractors and temps will reach their pensions auto-enrolment staging date next year.

“Agencies will need to automatically enrol these workers into a qualifying workplace pension scheme and begin making employer contributions. This process is far from straightforward, and our modelling suggests a typical setup cost of at least £25,000”, he said.

“The growing problem of ‘capacity crunch’ means any agency that has not yet appointed a pensions provider could well be turned away by their preferred partner.” He added: “Beyond pensions, the onerous reporting requirements linked to the onshore employment intermediaries legislation will become an unavoidable fact of life from April.”

“Returns submitted to HMRC must include detailed personal information on every contractor or temp who has been placed by the agency during the previous quarter, but is not paid via its own PAYE scheme. In addition to the worker’s full name, address, date of birth and National Insurance number, information such as the number of hours the individual has worked and the start date of their assignment will also need to be included. Fines will be imposed for late or incorrect returns.”

“It beggars belief that an industry already contending with more than its fair share of legislation is being lumbered with yet more red tape”, added Blakemore. “As always, however, the most agile and switched-on agencies will adapt and thrive.”