Recruitment agencies facing £25k pensions set-up hit, says Parasol
8 November 2012
Research carried out by professional employment organisation Parasol forecasts that agencies employing temporary workers on a PAYE basis could face an initial set-up cost of at least £25,000 as they get to grips with the legislation.
According to Parasol, this figure includes three months of senior internal resource, legal advice, director input, time spent engaging with clients and payroll software upgrades.
Thurs, 8 Nov 2012
Research carried out by professional employment organisation Parasol forecasts that agencies employing temporary workers on a PAYE basis could face an initial set-up cost of at least £25,000 as they get to grips with the legislation.
According to Parasol, this figure includes three months of senior internal resource, legal advice, director input, time spent engaging with clients and payroll software upgrades.
Parasol says it arrived at the sum after consulting with agencies to find out the steps they intended to take in preparation for the legislation. However, a statement from the company emphasised that the exact cost would vary for each agency.
Modelling by the Warrington-based employment firm revealed the following:
-- an agency with 800 workers who earn an average of £18k a year on PAYE can expect a total year-one cost of around £81,995 from the October 2013 staging date if 60% of workers opt out. If 30% of agency workers opt out, the projected cost – including initial set-up – rises to £111,242, Parasol reported.
-- for a smaller agency, with about 250 workers earning £25,000 annually each on PAYE, the total cost would be £49,812, assuming an opt-out rate of 60%. The predicted cost to an agency of this size, over the first 12 months from the February 2014 staging date, would increase to £64,200 if 30% of workers opt out.
Parasol launched in 2000. Its clients include Alexander Mann Solutions, Capita Resourcing, Hays and Reed.
Research carried out by professional employment organisation Parasol forecasts that agencies employing temporary workers on a PAYE basis could face an initial set-up cost of at least £25,000 as they get to grips with the legislation.
According to Parasol, this figure includes three months of senior internal resource, legal advice, director input, time spent engaging with clients and payroll software upgrades.
Parasol says it arrived at the sum after consulting with agencies to find out the steps they intended to take in preparation for the legislation. However, a statement from the company emphasised that the exact cost would vary for each agency.
Modelling by the Warrington-based employment firm revealed the following:
-- an agency with 800 workers who earn an average of £18k a year on PAYE can expect a total year-one cost of around £81,995 from the October 2013 staging date if 60% of workers opt out. If 30% of agency workers opt out, the projected cost – including initial set-up – rises to £111,242, Parasol reported.
-- for a smaller agency, with about 250 workers earning £25,000 annually each on PAYE, the total cost would be £49,812, assuming an opt-out rate of 60%. The predicted cost to an agency of this size, over the first 12 months from the February 2014 staging date, would increase to £64,200 if 30% of workers opt out.
Parasol launched in 2000. Its clients include Alexander Mann Solutions, Capita Resourcing, Hays and Reed.
