1. This site uses cookies. By continuing to use this site, you are agreeing to our use of cookies. Learn More.
  2. Hi Guest, welcome to the TES Community!

    Connect with like-minded education professionals and have your say on the issues that matter to you.

    Don't forget to look at the how to guide.

    Dismiss Notice

Umbrella company holiday pay

Discussion in 'Supply teaching' started by brosgidi, May 18, 2018.

  1. brosgidi

    brosgidi New commenter

    I started working as a Supply teacher in september 2017 and am being paid through an Umbrella Agency.
    As you will be aware, they receive my pay from the agency and from it deduct their margin, some holiday pay and employers NI before the rest goes as my gross taxable pay.
    Every week i work, about £100 from my pay is set aside as my holiday pay. I had been accruing this to cover the approaching summer holiday period, during which supply teachers obviously do not get paid.

    I have kept records and i should now have accrued around £2800.
    Today, i emailed the umbrella agency to ask them what their figure for my holiday pay was, only to be told it was £500. I emailed the guy back saying he must have made a mistake but he emailed back saying that their system is only showing £500 so whatever i had accrued upto April 5th this year had been lost if not taken by that date. So over £2300 lost because i did not claim it by April 5th.

    Lost? My money lost?
    I am ready to take this all the way with them but would like to ask what people think.
    The guy said this was in my contract. Could be in my contract but that doesnt make it fair. This is money i have worked for.
    Even if it was in my contract, would it not be the right thing for them to do to inform me as the deadline approached to take my holiday pay so i do not lose it?
    I have emailed their complaints department and hope to hear back from them on Monday, but how could i lose £2300 of my money because i did not ask for it by a certain date? So who have i lost it to?

    Any advice would be appreciated please.
     
  2. bounceback

    bounceback Occasional commenter

    I think there was a thread on a similar situation posted a while ago. I would email them again and ask them to email you the reason they are not paying out the money, letting them know you need their reasons in writing as you are taking legal advice. That might be enough to make them pay up. If you are in a union seek their advice. There is also an Employment Agency Standards Inspectorate that you could contact for advice and to make a complaint to. As you say, if they had a deadline for claiming money they should have notified you beforehand, but it doesn't sound as if what they are doing is legal, and if it is it's a scam that needs exposing.
     
    pepper5 likes this.
  3. The-Gaffer

    The-Gaffer Occasional commenter

    I did not want to read & run

    I feel for you & do not know if what they have done is legally enforceable, however I have heard that some companies do this at the end of the tax year

    You should have been informed of this somehow before the cut off point though either through the Umbrella Company or the Agency though
     
    pepper5 likes this.
  4. bounceback

    bounceback Occasional commenter

    Surely a system that makes people forfeit large amounts of their earnings because of what is essentially an oversight cannot possibly be legal.
     
  5. StarbucksCovfefe

    StarbucksCovfefe Occasional commenter

    Gosh how stressful. I'm a supply teacher and a business owner, and all I can add that as a business owner it is against the law for me not to give my staff their holiday. This is why companies often force people to book days off before the end of the holiday year. We're not even allowed to pay people instead of them taking it.

    So I'd be gobsmacked if the umbrellas can get away with it. Cant wait to they get scrapped for good.
     
    agathamorse likes this.
  6. bajan

    bajan Occasional commenter

    The umbrella company have said it's in your contract, so it's up to you to read your contract before you sign it. Sounds harsh, but they could argue they have done nothing wrong.
     
    pepper5 likes this.
  7. nearmiss

    nearmiss Lead commenter

    Are you in a Union? I would refer this to them. Also the TUC is running a long campaign to reduce the power of agencies and outsourced payroll. This sort of practice is very underhand.
    It will indeed be in the small print of your contract, that you have to claim your so-called holiday pay back by a given date, sometimes the end of the financial year, sometimes the end of the calendar year, sometimes the end of the academic year. There is no fixed time although in most cases it is the end of the financial year. In any case, your agency gets off scot-free because they are not responsible for the vagaries of the payroll provider and the payroll provider can claim that you entered the contract in good faith. They are under no obligation to remind you of the terms and conditions, however it is misleading to call the set-aside holiday pay if it is not actually set aside for the holidays, which for teachers is obviously the end of July.
    I wouldn't let this drop. It might be difficult to claim the money back, but you can try.
    BBC Radio 4's Moneybox programme frequently covers the whole question of umbrella payroll companies. They would certainly carry a story like this. Get in touch with their reporter Tony Bonsignore, he has been very supportive recently.
    Bad publicity is what agencies don't need right now as more people are wising up to the worst practices.
     
    agathamorse, JohnJCazorla and pepper5 like this.
  8. peapicker

    peapicker Star commenter

    I promised myself I wouldn't respond to this, but in all conscience I can't read and run.

    Holiday pay is governed by the Working Time Regulations. Your situation is a little complicated as @nearmiss has intimated. The general rules about holiday pay are set out here:

    https://www.gov.uk/holiday-entitlement-rights/holiday-pay-the-basics

    At the end of the information is the phone number of the ACAS helpline. I suggest you give them a ring and chat it through with them. You'll find them very helpful.
     
    agathamorse, JohnJCazorla and pepper5 like this.
  9. peapicker

    peapicker Star commenter

    Oh and I should add, PLEASE dump this agency and its associated umbrella company as fast as you can and sign up with an agency that pays you PAYE. Do not accept payment any other way except PAYE.

    This thread contains useful nformation about umbrella companies, though please note that the thread dates from before the important date of April 2017.

    https://community.tes.com/threads/umbrella-companies-vs-paye.691934/page-3

    It is no longer lawful (since April 2017) in most standard cases for a teacher not to be treated as an employee and for the agency to deduct employee's NI and PAYE before handing it over to a legitimate umbrella company (if they use one) to process payroll.

    You are being treated as self-employed, paying employers' NI and pension as well as your own, but interestingly also being treated as a 'worker' by the UC, by ostensibly having rolled holiday pay deducted. (They are not supposed to do this anymore.) The .gov information on holiday pay explains exactly how holiday pay should be calculated - in your case as someone working irregular hours, should have the average weekly wage calculated over 12 weeks. There is a calculator on the .gov website link.

    Please ring ACAS. This umbrella company has engaged in unauthorised deduction of earnings. Theft, in other words. They'll say you signed a contract agreeing to these terms, but you can't agree to something that is unlawful.

    It's a mess and I'm sorry that I'm not able to help you sort it out any more than i have. Please ring ACAS who will provide excellent information and advice and Citizens Advice also has excellent employment law specialists to support.

    If the UC doesn't give in, you may need to go to the small claims court to get your money back. Your union or CAB can help you to do this. Its straightforward and not expensive to do.

    *Waves to @nearmiss* ;)
     
    JohnJCazorla, nearmiss and pepper5 like this.
  10. KirstenMW

    KirstenMW New commenter

     
  11. KirstenMW

    KirstenMW New commenter

    Hi @brosgidi
    I’m in a similar situation (although much less money). Did you manage to recover your holiday pay and if so how?
    Thanks
     
  12. brosgidi

    brosgidi New commenter

    Hi Kristen,
    I have since stopped Supply (my last supply school offered me a job starting in August 2018 but yes, I did recover the pay.
    One email did it, not threatening, but explaining it is not fair and I am not ready to lose my holiday pay.
    The reply I got was that they have looked into it and just that once, the directors have authorised payment.
    I think it's one of those where they knew they didn't have a ground to stand on but we're just trying it.
    If they hadn't backed down, my next step would have been taking them to the small claims court, and I would advise you to do the same. It can't be right. Your holiday pay is your money and the onus in them is to inform you that you need to take the money or you will lose it, and not just keep quiet hoping you won't put up a fight.
    The only thing was they paid it all in one week, increasing my tax liability and meaning I didn't get as much as I would if I had taken it on instalments.
    Make sure you get your money and good luck.

    Brosgidi
     
    agathamorse likes this.
  13. hi sorry what did wrote for them to change their mind as i'm going through the same problem.
     
  14. brosgidi

    brosgidi New commenter

    Hi, I just made it clear to them that I was not going to give up my holiday pay and they backed down even before I could threaten them with the small claims court.
    They said the directors, for my case, were happy to make an exception.

    Just let them know it's not fair and you won't give it up and if necessary, do start a small claim against them.
    It'll cost you about £40 and hopefully they'll back down when they receive a court summons.

    All the best
     

Share This Page