Agencies + pension schemes + holiday deductions

UK PROFESSIONAL DRIVERS FORUMS THE UK PROFESSIONAL DRIVERS FORUM (INTERACTIVE)
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Auto-enrolment into a pension scheme is mandatory after 3 months service now. You have the option to opt-out, but you would be reducing the total pay packet available to you because the 3% minimum the employer pays is not deducted from your earnings, but additional to them.

One thing that probably won’t be specifically made clear is that you can opt-in from day 1 and not wait 3 months too. If you are moving agency a lot and want to be consistently putting money in a pension, just let them know that you want to be enrolled from day 1.

In terms of getting paid correctly for holidays, unfortunately I have had some bad experiences.

When leaving you should be paid up for accrued holiday and a P45 issued. Sometimes I have left it a while to see what happens and sure enough they will try and get away with issuing the P45 without the holiday pay. You really have to watch them, although not all are that bad.

Sadly I have also had to point out the calculations were incorrect on a few occasions, which is scarcely believable considering that most will have payroll software.

One tip is to be aware of what your holiday year is. Some contracts have it as the calendar year, some the financial year and some your holiday year ends on the anniversary of your start date. Some contracts will have you losing holiday if you don’t take it.

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stu675:
I worked for Extra Staff for 6 months and took holiday at the end of it, but I think the holiday pay was closer to 6% than 12% of pay received. I’ve asked them a few times about it but always get fobbed off and they never call back.
It’s a bit awkward when you don’t want to burn your bridges with them and say take them to small claims court.

Stu, I have found that early conciliation through ACAS will at least get someone to take you seriously, because the next step after that is Employment Tribunal for a claim for an unlawful deduction from wages.

If you go to the Tribunal and actually have a hearing, their cost in sending someone will probably outweigh anything they owe you.

Underpaying you is them basically asking you if you are aware of your rights and testing to see if you will do anything about it. The fact that they have this practice probably shows that quite often people don’t do anything and just give up hard-earned cash. I see underpayment of wages as akin to theft, so I always take action to recover wages due.

There is a time-limit for claims, so if they are wasting time, just submit and get the ball rolling.

23

peirre:

Conor:

peirre:
Personally I opted out of auto enrolment of the pension. Mainly because of my age and I’m already in receipt of pension benefits elsewhere.

You effectively gave yourself a 3% pay cut.

At my age I am never going to accrue an agency pension pot big enough to pish in, and being auto enrolled in the basic mandatory pension scheme was never going to work for me as I can save money elsewhere without worrying about the fluctuating values of annuities

How long until you retire, like has been said you are missing out on free money, and you don’t need to use it to give yourself a pension income when you retire, you can take it out of your pot and do what you like with it (25% of it tax free), work out what you are missing out on here

moneyhelper.org.uk/en/pensi … calculator

gov.uk/employers-workplace-pensions-rules

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We all have different circumstances, but generally paying into pensions is the best bet.
MSE is a widely respected site and a good start for anyone thinking about pensions for the first time or changing, (or getting near to changing) circumstances.

blog.moneysavingexpert.com/2021 … in-the-uk/?

Not many will benefit by opting out.

Look at all sources of info, but beware those, especially those based abroad who are outside of UK rules, who promise too much.
Sounds too good to be true? It probably is.

26

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And don`t anyone forget that money going into pensions is tax free.

If you pay £80 from your bank account into an approved pension scheme, £20 is paid by the Gov, and so your pot is £100 better off.

28

As always, some great info from EXPERINCE here thanks, prefer it to statements, and why asked for others experience, as worth tenfold anything else for me.

Pension wise take on board we get the goverments tax free top up, and question asked was to see if agencies drag their feet with either opt out or in, as one agency when asked, told me a load of BS about it, expect the extra work of correspondence was the reason lol.

Holiday pay is pretty much the same conclusion, but from experiences explained here, will be able to work around it, and just make sure nothing accumulates, and 25+ yrs ago, an arse called Nigel, at Prestige Contacts in Hull, screwed me for 20 days holiday, made Xmas crap, but was young, so although returning after a long time, not much has changed regardless of regulation, and again why asked for experiences not regulations…

So cheers ALL… now more aware what to expect, and options to work around things.

29

I worked for Extra Drivers at DPD and they pay rolled up holiday pay if you want it, which I did as it wasn’t my main job. My main agency is Pertemps and they will not give you rolled up holiday pay even if you ask for it.

Be careful when using rolled up pay, I saw a job ad this week and they gave both rates. Can’t remember exact figures but let’s just say the rolled up rate was significantly less than the normal rate +12.07%. If you really want rolled up pay make sure it’s the flat rate plus 12.07%. Yet another scam for agencies to fleece people with.

And I would never opt out of a pension scheme, it’s free money whichever way you want to dress it up, especially since the reforms mean you can access this money from age 55.

30

Terry T:
I worked for Extra Drivers at DPD and they pay rolled up holiday pay if you want it, which I did as it wasn’t my main job. My main agency is Pertemps and they will not give you rolled up holiday pay even if you ask for it.

Be careful when using rolled up pay, I saw a job ad this week and they gave both rates. Can’t remember exact figures but let’s just say the rolled up rate was significantly less than the normal rate +12.07%. If you really want rolled up pay make sure it’s the flat rate plus 12.07%. Yet another scam for agencies to fleece people with.

And I would never opt out of a pension scheme, it’s free money whichever way you want to dress it up, especially since the reforms mean you can access this money from age 55.

dozy:

Franglais:
And from ACAS
acas.org.uk/checking-holida … 0do%20this
“Rolled-up holiday pay
You must get paid for your holiday when you take it. If your employer is spreading your holiday pay over the year by adding an amount on top of your hourly rate, this is known as ‘rolled-up’ holiday pay and your employer should not do this.”

If you (as an employee) are being offered this it is illegal.

Yes I got told that , but the agencies I was with all paid it that way ( % of your hourly rate ) , so there either not bothered or they know something most on here don’t seem to know

Rolled-up holiday pay might have been legal once, but isn`t now.
“Workers must take the annual leave that they are entitled to and be paid when they take it. It is
not acceptable for an employer to add an amount on top of a worker’s hourly rate to take
account of holiday pay. This is known as ‘rolled up’ holiday pay. Following a Court of Justice of
the European Union (CJEU) decision,10 this is unlawful as workers should be encouraged to
take leave from work (receiving their normal level of pay while they are on holiday). Rolled-up
holiday pay acts as an unlawful disincentive to take holiday, as a worker’s hourly rate includes
the additional top up amount. It can also result in an underpayment of a worker’s statutory
holiday entitlement.”
From 2020, Page 14, and a link to ACAS as well.
assets.publishing.service.gov.u … or-pay.pdf

Will squad cars full of cops arrive to lock up the villians?
Dunno. They aren`t keen on chasing some other fraudsters…
…but that is another argument.

31

peirre:

shullbit:
How long until you retire

Without giving too much information away, let’s just say like the majority of drivers, I’m far closer to death than I am birth.

As a basic rate tax payer £4 out of your take home pay adds £8 to your pension pot. It’s literally a 100% return on your money even if you are retiring next year. It’s unbeatable.

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Terry T:
And I would never opt out of a pension scheme, it’s free money whichever way you want to dress it up, especially since the reforms mean you can access this money from age 55.

Isn’t that taxable @20% though? (on any lump sum you take out) which is 40% of the ‘‘free’’ money you got from employer contributions back into the void. Currently I pay 4% in vs 2.5% from the company so if I were to pay tax on a lump sum that would only leave me with .5% of the employers’ contributed money and the all the rest would be my own money that I’ve put in.

33

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34

The fairest system is being paid 12.07% of your gross earnings into a holiday pot that you can have paid any week you like, not just when you want to take a holiday.

You can also roll it over financial year end.

The “Pot” doesn’t decay if you don’t take it within 13 weeks of doing flat-out hours.

Because it builds up as a percentage of hourly-rate pay, you also get it on ALL hours, including “Overtime”.

During a normal full timer’s working week, of say 48 hours - you might accrue 26 days holiday per year in regular full time work, but any overtime you do on top of the base hours - WON’T accrue additional days off, unless you get some kind of “Day off in lieu” deal, usually about bank holidays…

Some firms do this “Banked Hours” thing, but that merely prevents you from benefiting from early knocks when the work is quiet… You’ll be expected to make up those days you got sent home early - with effectively “unpaid overtime” when it’s mentally busy, and you’d actually like to take some paid time off, but then get told “Sorry Bud, you’re not senior enough!”

The same applies to getting premium weeks off, like August & December…

Thus, the Holiday Pot System allows people to take holidays whenever they like, pay themselves from that pot whatever they like, and roll it up in a strategic manner too, such as to meet increased cost of living load at times of the month that you’d normally find yourself skint, especially if you’re paid monthly…

All in all, “Wot’s not-to-like” eh?

35

ETS:

Terry T:
And I would never opt out of a pension scheme, it’s free money whichever way you want to dress it up, especially since the reforms mean you can access this money from age 55.

Isn’t that taxable @20% though? (on any lump sum you take out) which is 40% of the ‘‘free’’ money you got from employer contributions back into the void. Currently I pay 4% in vs 2.5% from the company so if I were to pay tax on a lump sum that would only leave me with .5% of the employers’ contributed money and the all the rest would be my own money that I’ve put in.

Anything above the 25% tax free lump sum is taxable yes. I can kinda see the argument for not contributing very late on in retirement as any contributions will only pay off pennies per year but I would hope the OP has been contributing to his pot all his working life in which case topping it up with free money from your employer is usually the better option.

I have numerous friends with no private pensions. I keep going on at one of them but it never sinks in. They’re in for a rude awakening come retirement when their £40k salaries become £10k.

36

Well if some posts are true :smiling_imp: , those that took the jab are FUBAR as no payout of state pensions EVER, as if you dont reach retirement age not possible to receive your state pension, even if terminally ill… :laughing: :laughing: :laughing: jab transforms into something when hitting 65 … why they increased the age … :wink: pmsl… [ :grimacing: WIND-UP dont bite.] …

but when realised people cant get any of it if they get a terminal illness, did think it was a bit much … should at least get some of your money back.

37

Terry T:
Anything above the 25% tax free lump sum is taxable yes.

If you cash-in all your pot then you might well get a big tax bill. It can raise you into a higher band.
If you convert it into an annuity, or draw down the pot over time the tax implications are different.
There are lots of options out there, and not many of us are aware of all the implications.

I baulked at paying for an independent advisor, but the fees were made up in the first year.
Read up on it all but take advice from the experts too.

38

Franglais:

ETS:

TonkaBoy:
How easy is it to switch agencies on the same site ?

Depends on the site. WHen I was at eurocarparts they had a rule if you leave the current agency you can’t work there through a different one for 6 months (or weeks, can’t remember) the way it was explained was to prevent drivers from agency-hopping if one was to up their rates by say £.50

What! Hinder the free-market? :open_mouth: Prevent freedom to sell labour to the highest bidder?
I wonder who benefits from that? Employer or employee?? (rhetorical question of course)

It’s normally the site who impose the no switching rule, from an administrative point of view it’s a massive pain in the backside to ensure the correct agencies get credited with the correct hours if drivers are bouncing around between multiple suppliers.

39

there is a difference to being paid so much extra on an hourly rate to cover holiday oh wait no extra expenses no its holiday of crap its what we says its for depending on the direction of the wind and the employer putting 12.07% of your weekly wage in a pot that they pay separate to your wages. the last one is paye

back when i was working in warehouses the only option was umbrella i ended up paying nearly half my wages out in fees, taxes and holiday saving. The other scam is they charge you tax on the money they withhold for holiday pay and then charge you tax when they pay it out to you.

in other words avoid these umbrella scams like the plague it will end up costing you far more than the extra quid an hour

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TonkaBoy:
Well if some posts are true :smiling_imp: , those that took the jab are FUBAR as no payout of state pensions EVER, as if you dont reach retirement age not possible to receive your state pension, even if terminally ill… :laughing: :laughing: :laughing: jab transforms into something when hitting 65 … why they increased the age … :wink: pmsl… [ :grimacing: WIND-UP dont bite.] …

but when realised people cant get any of it if they get a terminal illness, did think it was a bit much … should at least get some of your money back.

Don’t forget, that killing you, on your own - isn’t enough. Your other half has got to be got rid of as well, otherwise she’ll be expecting her widow’s pension that has already been donked away by government fools playing the futures market badly, that have not even had the honesty to inform us of that fact yet…

Gas Price now down from 800 a year ago to 82 today…

Not a SNIFF that Gas Prices are coming down at the Utility Bill level as yet.
Not a SNIFF that such a price drop will feed into dropping the inflation figure as yet.
Not a SNIFF that we’ll be able to keep our mortgage payments up for another year as yet.
Not a SNIFF at any major protest by the activist Lefties… They are all wasting their time over people we don’t care about, rather than the people that don’t care about them constantly ensuring that they never get into power, even under Keir Starmer, 9 points ahead…