I registered with an agency today who tried to push me towards their own umbrella company, for which they woudf pay me an extra £1.00 an hour. When I said I would rather be on PAYE so I would qualify for holiday pay they told me it would make no difference as ‘your holiday pay is included in your hourly rate’.
This doesn’t seem fair or even legal to me. What does the panel think?
I had the same when I worked for an agency in an office I left 18 month ago, I chose PAYE and qualified for the same rates of pay and holidays as the other permanent staff.
The agency where well miffed but I was within my rights, I think it was a couple of years ago the law changed.
Not sure if its the same for the transport industry/drivers though.
OnlyAlan:
I registered with an agency today who tried to push me towards their own umbrella company, for which they woudf pay me an extra £1.00 an hour. When I said I would rather be on PAYE so I would qualify for holiday pay they told me it would make no difference as ‘your holiday pay is included in your hourly rate’.This doesn’t seem fair or even legal to me. What does the panel think?
I don’t think them paying you any extra money alleviates your rights to 28 days (paid )holiday a year. I’d think they’re talking rubbish.
found this don’t know if it will help 
Agency workers are classed as “workers” rather than as employees. All workers, including agency workers, are entitled to certain rights which include:
-paid annual leave
-rest breaks and limits on working time
-the National Minimum Wage
-no unlawful deductions from wages
-discrimination rights under the Equality Act 2010
-health and safety at work.
this was from a separate site as well
Holiday Entitlement for Zero Hour Contracts
The holiday year runs from 1 January to 31 December and the legal minimum
holiday entitlement is 5.6 weeks holiday or 28 days holiday per year.
Bank and public holidays are treated as normal working days.
As there are no fixed hours or days in the contract of employment, it is
often easiest to calculate holiday entitlement that accrues as hours are
worked.
The statutory entitlement of 5.6 weeks or 28 days is equivalent to 12.07
per cent of hours worked over a year.
The 12.07 per cent figure is 5.6 weeks’ holiday, divided by 46.4 weeks (being 52
weeks - 5.6 weeks). The 5.6 weeks are excluded from the calculation as the
worker would not be at work during those 5.6 weeks.
So if someone works 10 hours, they are entitled to 72.6 minutes paid holiday
(12.07 ÷ 100 x 10= 1.21 hours = 72.63 minutes)
How this would work in practice, as an example, if from January to March
someone has worked for a total of 180.5 hours then they would have accrued
21.79 hours paid holiday. (180.5 x 0.1207 = 21.79)
To work out the amount of holiday pay the usual hourly rate is
multiplied by the accrued hours.
For example: £7.00 x 21.79 hours = £152.53
OnlyAlan:
I registered with an agency today who tried to push me towards their own umbrella company, for which they woudf pay me an extra £1.00 an hour. When I said I would rather be on PAYE so I would qualify for holiday pay they told me it would make no difference as ‘your holiday pay is included in your hourly rate’.This doesn’t seem fair or even legal to me. What does the panel think?
“Rolled up” holiday pay has been deemed legal by an EU court however on your payslip it has to be clearly displayed how much of your pay is holiday pay. Also the hourly rate less the holiday pay has to be at or higher than NMW and the holiday pay component has to be at least the staturory minimum. National Minimum Wage is £6.31/hr so with holiday pay rolled in, if they’re paying you any less than £7.07/hr they’re breaking the law.
Statutory Holiday Pay works out at 12.07% of your gross basic pay. So for example if the rate is £10/hr without holiday pay then the equivalent to that with holiday pay rolled in would need to be a minimum of £11.21/hr for them to be paying you the legal minimum holiday pay.
Personally I think its a good thing as long as they pay it correctly. You get holiday pay for every hour you work and non of that “average of the last 13 weeks” rubbish which leaves you out of pocket if you have a few quiet weeks. The only thing is you have to remember to put some money aside to pay yourself when you take a holiday.
Thanks for that everyone, particularly Wildfire and Connor.
The hourly rate is £9.00 on PAYE or £10 in the umbrella scheme.
The value of holiday pay on at 40 hour week at 12.07% is £43.45 so more than the extra £1.00 per hour being offered in the umbrella. That’s before you cost in the loss of other benefits that a PAYE worker has and the charges made for the scheme.
Hmm, I can see why they were so keen to get me under their umbrella.
Thanks all.