So what will it cost me if I do what they want and convert my tradesmen to Employees?
It is generally reckoned that the additional payroll burden for employing as opposed to contracting is an increase in payroll costs of between 28 -40%. This is made up of, amongst other things:
- Employers National insurance costs
- Holiday pay
- Additional admin costs for dealing with PAYE and employment rights legislation
- New pension contributions which continue to rise
- Paternity and maternity leave costs
This estimate does NOT include any additional cost incurred through the reduced ability to vary your workforce to match your workload.