Christmas is a busy time for many industries such as retail and hospitality, with a lot of businesses required to take on extra staff via recruitment agencies. So, it's the season umbrella companies come into their own — offering contractors and temporary workers all the benefits of continuous PAYE employment.
But if you’re an umbrella company, handling the increased client workload within the same timeframe is challenging, particularly when it comes to payroll. Last minute changes, ad hoc payments, timesheet delays, and sorting out holiday pay for contractors on leave add to the complexity of managing weekly pay runs.
While this might mean chaos this Christmas, a simple change in approach to payments can bring transformative benefits next year.
Why payroll is the nightmare before Christmas for umbrella companies
The world of contract work and temporary employment is fast paced. But at Christmas, it’s even faster. Because workers have more work, longer hours and (even more) irregular schedules, it makes things particularly complicated for umbrella companies.
Overcoming these issues is almost impossible if an umbrella company still uses traditional payment services for payroll, or still relies on Bacs. Banks don't always process Faster Payments right away and the multiple bank holidays mean there are even fewer Bacs input and processing days, on top of the standard 3-day Bacs clearing cycle. This year, for example, the Bacs payment gateway is closed a total of seven days between 23rd-26th of December, and then 30th of December to January 1st. And with some banks having a reduced customer service over the festive season and limited support outside of regular working hours, if errors do occur, they can’t be resolved quickly.
All this adds complication, disruption and length to the usual payroll process.
Modulr: a Christmas gift for umbrella companies
Christmas doesn’t have to be a nightmare for umbrella companies, if they have the right tech behind them.
With Modulr, umbrella companies get all the benefits of instant, real-time payments, unrestricted by banking hours and cut-off times, or sluggish Bacs clearing cycles.
Thanks to Modulr’s direct access to the Faster Payments Scheme, payroll payments can be made every day, even Christmas day (or easily scheduled in advance!). Umbrella companies can say goodbye to payment delays or having to work around the Bacs processing calendar. And they have all the flexibility they need to make any last-minute payments or amendments.
All this functionality is available through leading payroll software providers such as My Digital, Zeel and Staffology or via a simple file upload directly to the Modulr portal.
It’s the payments gift that keeps on giving!
How Modulr saved BoostPay’s Christmas
BoostPay is an example of an umbrella company that used Modulr to overcome its Christmas payroll challenges. Prior to using Modulr, a payroll error meant all workers were paid twice and approximately £2.5 million had to be recovered.
“This obviously caused a lot of confusion for the workers and stress for me and my clients. I was constantly getting calls and we didn’t receive a statement from the bank that we could send to clients until two days after Boxing Day. When the money had finally been recovered the bank gave us no explanation and no apology.” Explained Director, Eileen Breeze.
Frustrated with the way things had been handled, BoostPay set out to find a provider that could help them process and change payments in real time without any delays during bank holidays.
“Modulr has been a different story from start to finish. If we ever need to speak to the team, we pick up the phone and they’re there. We’re also impressed by their due diligence process. Just because they’re not a bank it didn’t mean their security was any weaker or they were willing to onboard anyone. We’ve never doubted their security and compliance.”
Thanks to Modulr, BoostPay now ensures payroll hits bank accounts in seconds, any day of the week (even at Christmas) while slashing its costs by half!
Process payroll payments more efficiently with Modulr
Modulr is the digital payments partner of choice for leading payroll software providers like My Digital, Zeel and Staffology. Join thousands of accountants, SMEs and umbrella companies already using Modulr to keep on top of their workload and process payments faster than ever before.
If you’d like to learn more about how Modulr can help your umbrella company boost efficiency, then visit our solutions page here.