Employment Status under CIS. Agencies?

[Paul.B]

I run a small business installing structured cabling, fibre optics, containment, etc. About 30% of our turn over is either direct to the customer or sub-contracted through an electrical contractor on a price. We supply the materials and labour and install the network, simple.

The remaining 70% or so is sub-contracted on a day/hourly rate, mainly day rate. We work for other larger installation companies supplying them with labour, tools, vehicle, tester etc. A fully operational experienced solution.

Now, because of the nature of the our work it fluctuates so we have both PAYE and sub-contracted staff. Due to the change in the way sub-contractors are able to work under the CIS scheme, working status etc we are planing on only having PAYE staff. We don't do enough "price" work to keep sub-contractors busy only on price work.



My question is, how do agencies work? Are all their staff employed PAYE? Do they go through a payroll and get taxed PAYE? All their work must be on day/hourly rate? How do they work with the CIS scheme? Do all their men get full employment entitlements such as holiday? Can they pay their workers through the CIS scheme and the men remain "Self-employed"?

Basically, do I need to become an agency??? Nearly all my guys want to remain self employed and not become tied to one company.

Thanks

Paul.B

[Eric Mc]

It looks like the avenues open to individuals remaining self employed in the construction industry are now very much reduced. Don't forget, just because they may not work for you full time does not imply that they are self employed. There are plenty of part time employees out there - just walk into any supermarket and you'll see loads of them.

Agencies, by and large, "employ" their staff and pay them under PAYE.

[Paul.B]

Thanks Eric - If agencies employ their staff under PAYE, do they have to go through the redundancy procedure, P45 etc every time an assignment finishes? That could be 3,4,5,6 different assignments a month. Not continuous work.

I'm just trying to see if operating as an agency would be easier for me. I fully understand the whys & wherefores. Employers NICs etc. I know I have to accept that. I don't want to take on staff then lay them off, then re-employ them etc if I can avoid that hassle.

Paul.B

[Eric Mc]

I am no employment law expert but I do think that agency staff do not have all the rights attached to "normal" employees. However, a quick word with a specialist in the field might be in order.