The Mobile Worker Scheme (also known as the HMRC Travel and Subsistence Expenses Scheme) has been operated by some employment and recruitment agencies to take advantage of tax and National Insurance Contributions which relate to travel from home to a temporary workplace.
An amendment to the NMW Regulations is going to make participation in the Mobile Worker Scheme illegal for workers paid at or near the NMW. This comes into effect on 1st January 2011 and will be enforced by the Gangmasters Licensing Agency (GLA).
Agencies who use Zeva need not worry as all our services have always been compliant, and remain compliant come January 2011. But what of those agencies using other suppliers? What are their options?
1. Do nothing, wait and see – You may have been advised by your current umbrella company that they are putting something in place for January. Let’s face it, for umbrella companies whose sole business model was taking advantage of this ‘loophole’, then to move to a more traditional and compliant umbrella function may break their business. The temptation will be to offer the next loophole, which, may be just a bit more dodgy than the last one. Come January some agencies may be backed into a corner.
2. Transfer workers to a supplier offering a self employed service – Zeva offers a self employed service and it is very beneficial for worker and agency, as long as the worker is really self employed. If he is a disguised employee then the agency is at risk from false self employment, debt transfer, holiday pay claims, employment tribunals, etc , etc, etc. This is why before Zeva takes on any self-employed contractor, we perform a self employment test. Fail this, and we won’t accept the worker as a subcontractor, but instead, offer a more appropriate method of payment.
3. Move workers to a legitimate umbrella scheme – You may have noticed that most legitimate umbrella companies have just increased their minimum charge rate to £8.00. This is to guarantee that after employers NI, holidays and the company’s fee have been deducted there is enough cash to pay the worker at least £5.93 per hour. You will probably find that as the umbrella company has the same costs as you, but charges a £15 to £25 fee on top, that its actually cheaper to pay the worker PAYE yourself. Zeva is unique in that our systems allow our fees to be automatically reduced in the event that NMW is threatened, and so we can offer a minimum charge rate of £7.75 per hour while still guaranteeing the worker a minimum £5.93 per hour, in accordance with the NMW regulations as per January 2011.
4. Use Zeva to legally minimise your worker payments. Zeva can pay your whole workforce starting at the following minimum charge rates:
|Umbrella contractors from||£7.75ph|
Zeva provides not only legal and professional payment options to ALL your workers, but can provide income of up to 26.4% savings on all expenses claimed. These services are available now, and will still be available in January 2011.
Zeva: audited and approved by the GLA