The industry group, All Umbrella Companies Are Equal, has spent the last year working closely with HMRC to produce a manual for its umbrella company members, detailing what constitutes a “compliant’ umbrella company.
The comments and guidance provided by HMRC on the manual give a definitive standard that will be adopted by all its members and those wishing to gain membership to the self-regulatory group. The group, which now has 36 approved members and 11 pending applications, represents well over 30% of all UK umbrella companies and is fast becoming the go-to place for both contractors and recruiters looking to gain valuable advice about the industry.
Lisa Keeble; one of the founder members commented; “Over the past few years there have been many debates between industry professionals as to what would constitute a “compliant” umbrella; this manual will now confirm just that! It will undoubtedly allow us to provide clearer guidance to all those involved in the contracting market and give confirmation for those intending to work to HMRC guidelines.”
Amongst the guidance, HMRC have confirmed what requirements are necessary in order for a contract of employment to be “truly” over-arching, covering topics such as; Mutuality of Obligation with the provision for a minimum of 336 hours, pay between assignments and Statutory Employment rights. There is also confirmation that any UK PAYE umbrella company should no longer be operating, what is commonly referred to as, “Rolled Up Holiday Pay” and that all umbrella’s should be allowing for the provision of pay when holiday is taken. The All Umbrella Companies Are Equal group would like to thank HMRC for their ongoing support and assistance in helping to create a level playing field.
This article has been written by Lucy Smith, one of the founder members of the All Umbrella Companies Are Equal regulatory group.