The value of recruitment agencies in the education sector

Oct282015

Today the National Union of Teachers is holding a lobby against the use of recruitment agencies in the education sector. They’ve asked some questions. We’ve got the answers.

Why do schools need supply teachers?

Supply teachers fulfil an important function. When a teacher calls in sick or needs to take leave, the school needs to bring in a qualified and vetted supply teacher ASAP. The school doesn’t have the resource to find that person themselves so quickly, nor does their local authority – so they go to an agency. Ninety-seven per cent of our members have staff working between the hours of 5am to 8am to fulfil this function. Without them, pupils would be the ones who suffer.

We’ve worked hard to ensure that schools understand exactly what they should expect from a good quality, compliant agency – for instance, early in 2014 we published a free guide for all schools called ‘Putting Pupils First’.

Equally important is NUT’s own data on why individuals are supply teachers. The majority choose to work this way as a “lifestyle choice”. They found that the number working this way because they can’t find a permanent job is falling.

What do supply teachers get paid?

The pay of a supply teacher depends on a number of factors, such as location, the teacher’s experience, and whether the teacher has qualified for equal pay under the Agency Worker Regulations 2010 (AWR).

Pay rates are not decided by our members but at the direction of the school and in negotiation with the supply teacher. As soon as a teacher qualifies under AWR, they are entitled to equal pay (as we’ve made clear in our free guidance for teachers).

Pay rates do vary from school to school, depending on the arrangements the school has in place for its own staff. One thing agencies do struggle with is getting sufficient information from the school to work out what equal treatment (including pay) a teacher would be entitled to from the school if it employed them directly.

Interestingly, in their Supply Teacher Survey in June this year, the NUT said that “supply teacher pay is edging upwards”.

Do teachers receive sick pay and pensions?

Despite the NUT’s statement that supply teachers are not entitled to sick pay, maternity pay or pensions, agency workers are entitled to Statutory Sick Pay, Statutory Maternity Pay, and they are entitled to be auto-enrolled into a qualifying pension scheme.

In no way do recruitment agencies deny supply teachers access to the Teachers’ Pension Scheme (TPS). Employment through supply agencies is not pensionable under the TPS as, currently, DfE does not allow agencies to participate.

We agree with the NUT that this is unfair on supply teachers. We have previously offered to work together with the teaching unions on issues affecting supply teachers, such as access to the TPS, as this can only improve the wellbeing of the workforce.

What about the agency’s fee?

When an agency supplies a teacher on a temporary basis, they charge a daily rate. In a recent survey of our education agencies, 91% charged a margin of between 15-30% for temporary assignments.

This daily rate varies from agency to agency and is completely dependent on factors such as level of pay (in relation to location, how experienced a teacher is, subject, etc.) and whether it is a long-term assignment (including factors such as whether there will be planning and marking involved).

The agency’s margin has to also cover National Insurance, holiday pay, public liability insurance, ongoing marketing, safeguarding and background checks, CPD opportunities, the support and advice to schools on candidate pools, pre-booking management, the development of supply teacher handbooks for schools to support their supply staff, the learning and development of an agency’s own consultants, the payroll systems and other associated liabilities.

How do Umbrella companies work?  

Many agencies give supply teachers the option of working on a ‘PAYE’ contract or working through an umbrella company and many supply teachers also request to work through an umbrella company they already know. Umbrella companies are now a relatively established part of the supply chain.

Recruitment agencies must abide by the Conduct of Employment Agencies and Employment Businesses Regulations 2003. Those regulations recognise that temporary workers may work through limited companies, including umbrella companies. It is not a breach of the regulations for an agency’s teachers to work through an umbrella company.

To ensure standards are maintained, we recommend that our members only work with an umbrella company that has passed the FCSA compliance standards. We’ve also campaigned vigorously for HMRC and BIS to provide better guidance on umbrellas.

What about offshore Umbrella companies?

In April 2014, changes were made to the Income Tax (Earnings and Pensions) Act 2003 which meant that employment businesses are required to deduct tax and NICs from individuals working through overseas companies where they were under supervision, direction or control – and so this is a feature of the market that has largely disappeared. We do not recommend that members employ individuals via overseas companies.

How much do agencies invest in education?

We recently surveyed our members on this subject and found that 82 per cent of education agencies invest revenue back into education. This includes providing professional support for supply teachers, careers advice for young people, support specifically for NQTs, workshops for pupils, and charitable projects overseas. Read our blog on how two of our members invest in education.

Three quarters of our members said they offer CPD to their supply teachers. Education agencies look after and are protective of their teachers, and this makes a lot of sense because the supply teachers they send into schools on short and long-term assignments are representative of their agency. An agency is only as good as their teachers so the simple question is - why wouldn’t agencies invest and train their workforce to be the best they can be?

The REC conducted an online survey of 62 agencies between 06/10/2015 – 18/10/15. Our infographic of the results is available here.

This entry was posted on Wednesday, October 28th, 2015 by:

Kate Shoesmith
Kate Shoesmith - Head of Policy & Public Affairs

Kate is Head of Policy & Public Affairs and has been with the REC since March 2013.  She is responsible for policy, stakeholder and member engagement, and influencing for the organisation.  Kate works on our key campaigns including those on Regulation and Tax changes, Diversity, Flexible Working, and Youth Employment & Skills. 

Prior to joining REC, Kate was Head of Policy & Corporate Affairs at City & Guilds. Kate has also been an adviser on a number of external forums, including for Business in the Community’s Workplace Skills Advisory Group, CIPD’s Learning to Work and the UNESCO Education for All Global Monitoring Report.  Kate is also a college governor and a board member for Youth Employment UK

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