In response to the Dispatches programme on Channel 4 Legal Director Julian Ball said: "The programme confirms that there are non-compliant providers out there and that agencies and contractors should choose their umbrella companies carefully. Unfortunately the behavior of these companies tarnishes the industry as a whole and gives those who don't really understand the industry the opportunity to call for action against all umbrella companies. I liken it to watching a programme on cowboy builders and asking for the building trade to be shutdown which is of course nonsense.
Fortunately the vast majority of umbrella companies do operate compliantly and provide support to workers as they move from contract to contract. Compliant umbrellas guarantee national minimum wage, pay sick pay, maternity and paternity pay to workers and provide insurance cover which may otherwise not be available to the workers. Our contractors certainly appreciate the support with 94% saying they would recommend a friend.
There has generally been a move by agencies to deal only with umbrellas who can demonstrate compliant processes. PayStream's compliance team audits the business internally but we also have external compliance audits carried out by Professional Passport and BDO which have been well received by agencies.
I think what is needed now is for HMRC to enforce the legislation that is already in place and take action against any business that is flouting National Minimum Wage."