Industry accreditations can make it much easier for recruiters to ensure their umbrella company partners are both competent and compliant, but only if they understand the detail behind the badge. In this article we’ll look at the most common industry accreditations and explain what they mean and why they’re useful.
What are Umbrella Accreditations?
Umbrella accreditations are certifications or endorsements granted to umbrella companies by another organisation. Effectively, the accrediting body is saying the umbrella meets their standards. These accreditations serve as indicators of a company’s commitment to compliance, ethical practices, and service quality. For recruitment agencies, partnering with accredited umbrella companies can mitigate risks associated with non-compliance, including tax liabilities and reputational damage.
Types of Umbrella Accreditations:
FCSA (Freelancer & Contractor Services Association):
The FCSA is a prominent trade association representing professional employment service providers. FCSA accreditation signifies adherence to rigorous compliance standards, covering areas such as taxation, employment law, and ethical conduct. For recruitment agencies, partnering with FCSA-accredited umbrella companies offers assurance of working with compliant and reputable service providers.
Professional Passport:
Professional Passport is another accreditation body dedicated to promoting compliance and best practices within the umbrella sector. Their accreditation process evaluates companies on various criteria, including financial stability, contractual transparency, and adherence to legislation. Recruitment agencies can rely on Professional Passport accreditation to identify umbrella companies committed to excellence and compliance.
APSCo (Association of Professional Staffing Companies):
While primarily focusing on broader staffing and recruitment industry standards, APSCo also provide accreditation for umbrella services. APSCo accreditation signifies commitment to ethical conduct, professional standards, and legislative compliance across the recruitment supply chain. For agencies seeking umbrella partners aligned with industry best practices, APSCo accreditation serves as a valuable benchmark.
SafeRec
SafeRec uses AI technology to perform real-time forensic audits of all payslips. This ensures contractors payments are processed compliantly, and allows certified umbrella companies to prove compliance, with detailed audit reports, cross referenced with the HMRC business account.
Importance to Recruitment Agencies:
Risk Mitigation: Partnering with accredited umbrella companies reduces the risk of non-compliance, tax avoidance, and legal liabilities for recruitment agencies. Accreditations demonstrate a commitment to operating within legal frameworks and upholding industry standards, minimising the potential for regulatory penalties or reputational damage.
Quality Assurance: Accredited umbrella companies adhere to stringent quality standards, ensuring professionalism, transparency, and reliability in their services. For recruitment agencies, this translates to enhanced client satisfaction, streamlined operations, and strengthened business relationships built on trust and accountability.
Competitive Advantage: By collaborating with accredited umbrella companies, recruitment agencies differentiate themselves in the market by offering assurance of working with reputable and compliant service providers. Accreditation serves as a badge of credibility, enhancing the agency’s reputation and attracting clients who prioritise ethical and compliant workforce solutions.
If your umbrella company doesn’t hold any accreditations
The absence of accreditations doesn’t necessarily mean an umbrella is not compliant – there could be any number of reasons why they have not achieved, or have decided not to pursue accreditation.
However, in the absence of accreditation it’s even more important that the recruiter vets the umbrella carefully before recommending them to contractors, to ensure they are compliant, competent, and committed to the high service levels your contractors expect. Failure to do this can have wide ranging negative consequences that directly affect your business.
If you have questions or we can help in any way, please call our expert team on 01604 360222 or email [email protected].
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