Wales Government takes fresh action against Umbrella Companies

UCATT has welcomed a further move by the Wales Government to prevent umbrella companies being used on public contracts.

This week Jane Hutt the Minister for Finance and Government Business has issued a Procurement Advice Note (PAN) which has been sent to every public body (including councils and NHS Trusts) in Wales. The PAN note tackles the problems of umbrella companies and false self-employment and provides guidance to public bodies about how they can prevent these practices occurring.

The issuing of the PAN advice follows the decision of the Welsh Government in January to bar umbrella companies on all of their infrastructure projects.

The decision by the Welsh Government to crackdown on umbrella companies follows strong lobbying led by UCATT. Construction workers forced to operate via umbrella companies report that they can be up to £100 a week worse off. Workers have to pay both employees’ and employer’s national insurance contributions which is over 25% of eligible earnings. Workers are also charged up to £30 a week for the privilege of being paid via an umbrella company.

Nick Blundell, Regional Secretary for UCATT’s Wales and South West Region, said: “This is a further step to outlawing umbrella companies in Wales. The Welsh Government should be congratulated for cracking down on exploitative forms of employment.”

Mr Blundell, added; “The campaign is far from over. UCATT will now be ensuring that the PAN guidance is understood and utilised by all public bodies in Wales. UCATT has already entered into discussions with several local councils on this matter.”

UCATT will also be notifying the Welsh Government of bad practice in the private sector, in order to apply pressure for them to be removed from tender lists.


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