Paying contractors quickly is often listed as a selling point for umbrella companies, and we know that when new contractors join an umbrella, they’re often eager to get paid as soon as possible. In this article, we’ll look at whether the speed of processing is really important to most umbrella employees, or if other considerations are more important.
When your contractors start with a new umbrella company
This is where we see the most pressure to pay quickly, which is understandable. When a contractor is starting a new contract, possibly even contracting for the first time, it’s more likely that they’ll be under financial pressure and will need their first payment as soon as possible.
For this reason, it can be important that your umbrella company can register new employees and get them paid as smoothly and quickly as possible.
For established umbrella company employees
Once your contractors have been paid for the first time, the length of time from completing work to getting paid is no longer so important, as long as they get paid when they expect to. Established umbrella contractors may still chase their pay, but in our experience, this is usually because they’re uncertain about when they’ll be paid, rather than because they need their money quickly.
Consistency is key
One of the biggest sources of stress among contractors is uncertainty about when they will be paid. They may feel that they need to chase all the time for information, and sometimes even that they won’t get paid in time if they don’t chase every week.
The way to combat this uncertainty and the associated stress, is to make sure your contractors know when they can expect to be paid, and ensure that it always happens.
For example, if your contractor expects to get paid every Friday, there’s limited benefit in getting their money to them by Wednesday, particularly if this can only be done sometimes. It’s far better to ensure their money is always there on Friday as expected, so they know when they’ll be paid and they can trust that it’s going to happen.
Working with your umbrella company
As a recruiter, the best way to achieve this consistency is to work with your umbrella partners to align your processes and get them running like clockwork. By working together, you can make sure everyone knows when to expect information and payments to arrive, and ensure occasional errors and issues don’t result in delays.
If you have questions or if we can help in any way, please call our expert team on 01296 468483 or email info@orangegenie.com.