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What stops me from setting up a company and instead of hiring permanent employees, simply sourcing anything I need from an agency? No issues about getting rid of people at times of low demand; no employer's national insurance to pay; and no pension contributions to make.
Actually, what stops every company from doing this?
It's expensive!
how do you think agencies make money?
I thought that's how you were employed flap? Out of Oireland or something?
Taff - Member
It's expensive!Posted 2 minutes ago # Report-Post
jam bo - Member
how do you think agencies make money?
Those reason are pretty good short term arguments, but long term with holiday/sick/maternity/redundancy pay taken into consideration, would it not even out?
Having worked as contractor (not highly paid) for most of my career, as very few companies actually want to employ ppl in my field & are happy to pay the extra to be able to get rid of you at the drop of a hat.
and to counter the argument that contractors are supposed to have 'rights' now, all agencies I've talked to expect you to opt out of the scheme, if you want a job through them..
was talking about this the other day.
if i had a company i'd have self-employed people working for me.
when there is work you work. when there isn' any work you don't work.
no holiday pay. no sick pay. no insurance.
you can get rid of bad workers and they can't kick up a fuss at an employment tribunal.
the best man (or woman) gets the job.
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i'm self employed and all of the above relates to me. i think it is fair.
i also receive more money this way than i would if i were employed in a similar business.
i read somewhere that an employee receives is only ~30-40% of what it costs the comapny to employ them.
Agency work has its advantages and disadvantages for both employee and employer.
For example if you used agency workers and they all want holidays at the same time you have no way of stopping them. You could easily find one monday morning you have no staff at all as they all decide they don't want to work that day.
Its more expensive as you still have to pay their NI and tax and holiday pay plus you have to pay a premium to the agency. In my job agency staff costs are 30% - 200% higher than directly employed
Its also harder to manage the staff and to control the quality of them
There was a programme on the BBC last night called Low Pay Nation. I wasn't really paying attention to it but there was something about companies 'employing' people on a self employed basis, and suggested it wasn't quite legal. I don't know the details, it'll no doubt be on iPlayer if anyone wants to see it.
Stoner - exactly right. Bloody hell, the accountant sucked his teeth the first time he saw it! Basically what Alpin said.
Surprised the costs are that high, though. I know the agency creams off about 5% of my gross pay, but it's invisible to me. Having said that, everyone else at the company has had an RPI pay increase for the last two years and I haven't, so I guess it must be starting to even out now.
[i]Actually, what stops every company from doing this?[/i]
I'd imagine that it depends on the business to some extent. If you don't feel valued by the business, you're not going to have any loyalty to it, which may be a problem if the person is generating intellectual property or business for you.
IME the majority of agency that come through our doors are not employed for a reason. We go must go through ten of them to find a good one and getting one that speaks even a basic level of English is half the battle.
Employing agency staff usually equals the cost of employing staff directly even taking into account Employers NI, holidays and sickness.
The biggest difference comes through experience and loyalty. An agency worker will not be able to process the same amount of work as another employed staff as they go through a natural learning curve specific to how each company operates just the same a newly employed staff can't do the same an experienced member of staff. If the agency worker doesn't like your company then nothing can stop them not turning up again so you're back to square one starting another agency worker the following day with equally low productivity.
More and more companies are using part time staff and increasing their hours when required and reverting back to their standard hours when not required. This way they have the experience and no need to explain a job requirement creating instant productivity. Other options are keeping self employed workers on a retainer so that you may call upon the same people to undertake a job and get their priority over their other customers.

