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Hints and tips on how to manage your PSL

Kerry Hull

Kerry Hull | Marketing Manager

Wednesday 4th Dec, 2019

 

Over recent years we have seen lots of legislation being introduced into the flexible labour market. From the public sector IR35 reforms, to the Criminal Finances Act (CFA) and now the upcoming private sector IR35 reforms. All of this legislation has been introduced with one goal in mind and that's to ensure that Government get what they see as their fair share of tax. 

With legislation like the IR35 reforms moving the liability for any unpaid tax up the chain to the person paying the PSC (usually the end client or agency) and the CFA making it easier for the Government to convict companies where their employees have facilitated tax evasion. It is now more important than ever before to ensure that you are not only working with compliant providers but that you are enforcing the use of those compliant providers throughout the supply chain.

Our advice to agencies whose consultants refer their contractors on to third parties is to make sure that you know who you are dealing with. The best way to do this is to have a PSL comprising companies that you know and trust. Putting together a PSL is one thing but making sure it works properly is another. Here are our top tips to make sure PSLs work:

1. Monitor placements vs referrals - if there is a big discrepancy you may have a leakage problem

2. For PSCs capture the accountant's name when you issue a contract - Agencies know the names of umbrellas that their contractors use (because they pay them) but are sometimes blind to schemes that PSC contractors use. By capturing names you may see a pattern of referrals prompting you to look at the accountant.

3. Hold regular meetings with your chosen providers - review performance and share referral information.

4. Contact non-approved providers - if you identify a company dealing with a number of your contractors ask how they generated the business.

5. Check the marketing merchandise on consultants' desks - this may give you a clue who your consultants are talking to.

6.Take a hard stance with non-conforming staff members - be clear what is acceptable and what is not.

If you're in the process of setting up a PSL and would like some help and advice then either visit our hints and tips page, contact your local CRM or call 0161 923 0201.

Related article - Creating a PSL our hints and tips

Managing a large number of suppliers can be inefficient for any business, because every supplier has different processes and diverse working practices. On top of that, legislation around the recruitment sector is such that a supplier's processes could create a different risk profile to that of the recruitment agency. That's why clear emphasis on compliance from the provider creates a level of comfort for the recruitment agency. We are all in business for the long term, so choosing an established, financially strong partner with good staff retention is paramount. Here is our guide on how to do just that.

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