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Recruiters facing admin double whammy in 2015

The outsourced employment services provider 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 &pound25,000.

“The growing problem of & lsquo;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.”

Parasol announced last month that it was investing a six-figure sum in software designed to ease the administrative burden placed on recruitment firms by the onshore intermediaries legislation. Contractor employee pay and assignment data will be transferred to recruitment firms via a secure, encrypted web portal. 

Meanwhile, more than 5,000 Parasol contractor employees have now been automatically enrolled in the company’s workplace pension scheme under auto-enrolment legislation.

Latest figures show its opt-out rate now stands at 31%, up from 12.8% in July 2013.

“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.” 

Click here to download Parasol’s free guides to pensions auto-enrolment and the onshore employment intermediaries legislation. 

Parasol is part of the Optionis group.


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