How StoneBridge Pay is meeting the government’s criteria for “good practice” in the umbrella company sector

In this article, we’ve broken down the government’s new umbrella guidance into eight phrases they have written to explain how umbrella companies can show “best practices” when operating. We have responded to each, explaining why StoneBridge Pay (FCSA accredited) goes above and beyond to meet the highest customer service and compliance standards.

1. “Umbrella companies should be run by fit and proper people”
2. “Umbrella companies should be financially viable”
3. “Umbrella companies must follow the statutory requirements that apply to all employers”
4. “Umbrella companies must accurately operate the payroll for their employees”
5. “Umbrella companies should compete based on lawful practices”
6. “Umbrella companies should be clear, open and honest in the information they provide their employees”
7. “Umbrella companies should provide employee care”
8. “Umbrella companies should provide recruitment agencies with the information they need to meet their legal obligations”

 You can read the official guidance on the government’s website, available here.

“Umbrella companies should be run by fit and proper people”

StoneBridge Pay:

• Founded in 2017 and compromising of a team with decades of experience in the contractor payroll sector, we’re ran by experts who understand the industry and associated complexities inside-out.
• Our company information is publicly available on Companies House. Search for ‘StoneBridge Payment Solutions Ltd’. Our registered company number is 10744315. We have a perfect track record, and all our company information is visible to all who require it.
• We’re proud to be an accredited member of the Freelancer & Contractor Services Association (FCSA). From the beginning, we’ve always prioritised compliance within our sector, and our FCSA membership showcases this, proving we adhere to the FCSA’s strict Codes of Compliance, which are available on their website.
• With compliance at the heart of everything we do, our in-house Compliance Department is on hand to ensure we always adhere to the highest standards, and support is always available for our partnered agencies and contingent workforce.
• With a new Operational Team consisting of over 20 highly qualified professionals, we provide quick and accurate assistance to our partners and contingent workers. In house departments consist of Customer Service and Registrations, Payroll, Accounts, Compliance, Marketing, Account Management and Business Development.

“Umbrella companies should be financially viable”

StoneBridge Pay:

• Our payroll is run daily, and we always have the appropriate funds to ensure workers are paid correctly and on time.
• Traditionally, we process payments to workers having received funds from our partnered recruitment agencies (at the agreed payment schedule). However, we do offer tailored payment terms and financial agreements for our partnered agencies (subject to approval). Financial terms are insured to the agreed limit.
• Before partnering with agencies, we conduct thorough due diligence and reviews into our partners and their financial circumstances – to ensure risks of late payments are minimal.
• Since 2017, StoneBridge Pay has experienced exciting growth, and we continue to pay more and more contingent workers every month.
• We provide our partnered agencies with flexible terms, and can accept payments via a Corporate AMEX card and Capital on Tap Visa – our way of ensuring agencies can get added value by partnering with us (thanks to improved cash flow and the benefits such as airmiles, etc.).

“Umbrella companies must follow the statutory requirements that apply to all employers”

StoneBridge Pay:

• Before we can complete a worker’s onboarding process, they must provide the correct identification and Right to Work (RTW) documentation. Failure to provide the correct documentation will result in a worker being unable to complete the registration process and not being paid. Our in-house Customer Service and Registration Department is on hand to provide support.
• Workers are issued a Contract of Employment which must be signed and returned before the registration process is complete.
• We will enrol workers into a pension and provide them with the information they need to continue contributing or opt-out.
• Every time we process a payment, workers are issued a Pay Statement showing the assignment rate and legal deductions. These documents are emailed to the worker (password protected), and available via our online portal.
• Workers using StoneBridge Pay (umbrella) have access to Statutory Employment Rights, and we provide all the information they need before registering (while providing support throughout their time with us).
• Our Compliance Department is up to speed on all the important legislation impacting contingent workers, including, but not limited to, the Agency Worker Regulations 2010, Working Time Regulations 1998, National Minimum Wage Act 1998, Employment Right Act 1996, and Pensions Act 2004.

“Umbrella companies must accurately operate the payroll for their employees”

StoneBridge Pay:

• We recently switched to an FCSA-partnered payroll software provider, which specialises in efficient and compliant payroll for contingent workers.
• Workers can request a take-home pay illustration before registering, which we can tailor to their circumstances to ensure it’s as accurate as possible.
• Before registering, workers need to provide us with a P45 or complete the New Starter Checklist – to ensure they are put on the correct tax code.
• Payroll is processed transparently and compliantly, and we ensure that every worker we engage is paid at least the National Minimum Wage (after deductions). We also liaise with our partnered agencies to ensure that umbrella assignment rates meet these requirements.
• Pay Statements are issued every time a worker is paid, showing the assignment rate and appropriate deductions (including income tax, Employee National Insurance, our margin, employment costs and pension, student loan and additional deductions – if applicable). Once a payment is processed, workers will receive their Pay Statement via password-protected email, and they can also log in to our portal to access important documentation.
• All payments are sent to the worker’s personal bank account. We do not process payments to business bank accounts for PAYE employees, and we will never send payments to third parties.
• Upon registering, workers receive a welcome email outlining all the important information about using our payroll service.
• Our workers and partners always receive ongoing support. The StoneBridge Pay direct line is 020 4591 2677, and the email address is [email protected].

“Umbrella companies should compete based on lawful practices”

StoneBridge Pay:

• All umbrella employee payments are processed in accordance with HMRC’s tax system– Pay As You Earn (PAYE). We will never process their payroll in any other way and will never promote or facilitate tax avoidance.
• Workers who are CIS registered will be paid accordingly. 20% tax deductions will be sent to HMRC on account for workers with a Unique Tax Reference (UTR). Workers without a UTR will have 30% tax deductions.
• We provide tax support to all our workers who are engaged via the Construction Industry Scheme, and those who have used our services for a minimum number of weeks are entitled to a free self-assessment tax return from one of our approved partners.
• Our Compliance Department is up to speed on the various non-compliant tax avoidance schemes being operated by unscrupulous payroll providers. Payroll is always operated compliantly, and we will help educate any worker who has considered using a scheme that we believe may be tax avoidance.
• Due to the introduction of Supervision, Direction and Control legislation, we do not process expenses for umbrella company employees. We only process mileage expenses for construction workers (for multi-site operatives). However, workers are required to complete a thorough form to request such expenses and must answer questions about supervision, direction and control within their place of work. Workers must pass our internal processes to be eligible to claim mileage expenses.

“Umbrella companies should be clear, open and honest in the information they provide their employees”

StoneBridge Pay:

• Our margin is always clearly communicated with workers before they register, and it is clearly labelled on Pay Statements.
• Workers can access an example Pay Statement with annotations to provide any necessary clarity on how payments are processed.
• Each registration is tailored to the specific worker – to ensure we gather all the necessary information to pay them correctly, efficiently and compliantly.
• We provide workers with our PAYE reference number, employee tax code, year to date figures and holiday pay.
• Upon registering, we send a signed copy of the Contract of Employment to our workers for their safekeeping.
• Our Contract of Employment details the pay structure, explaining basic pay, deductions and any additional taxable pay.
• Our website is regularly updated with useful information targeted at contingent workers and professionals working in recruitment (including multiple tailored FAQs). We also post articles on industry developments (including government releases).
• We promote our FCSA accreditation to showcase our commitment to providing the very best compliant services to supply chain members. We regularly engage with the FCSA to discuss important industry news, legislation changes, and upcoming developments.

“Umbrella companies should provide employee care”

StoneBridge Pay:

• Our team provides workers with a thorough explanation of how StoneBridge Pay works and that we are the employer for tax purposes (not the agency/end client).
• Ongoing support is available to all workers (and recruitment consultants) via our dedicated phone line and numerous dedicated email mailboxes.
• When workers register, they’re issued an Employee Handbook explaining how we operate and answering the most commonly asked questions about important topics, including pensions, payments, and more.
• Pay Statements are emailed automatically to workers whenever we pay them (password protected).
• Every month, we run a lottery where our workers can win vouchers – a small way of us thanking them for choosing StoneBridge Pay.
• We offer more than just payroll. Our workers have access to an array of extras, including 24/7 GP phone support, insurance coverage, an industry-leading online portal, an exclusive discount scheme, free advice from our expert contractor financial partners, and more.

“Umbrella companies should provide recruitment agencies with the information they need to meet their legal obligations”

StoneBridge Pay:

• Upon engaging with an agency, we will send them important compliance and company information.
• Our website features a ‘Consultant Toolkit’, full of helpful resources for recruitment agencies, including a Key Information Document (KID), employee illustration, FCSA certificate, insurance documentation, Right to Work Checklist and information on IR35 legislation. We’re regularly updating our website and adding more useful information for members of the supply chain.
• We regularly send email campaigns to recruitment agencies about company developments and essential industry news.
• Partners have access to the SB Pay portal – a powerful interface that provides easy-to-access information about all the workers they have referred to us. We recently published a video which runs through the key portal features and how to get the most from the new, improved software.
• Our dedicated Account Management and Business Development teams are on hand to support agencies.
• We send agencies Onshore Employment Intermediaries Reporting every quarter.

Changes are coming to the umbrella company sector

From April 2026, the government will initiate legislation first referenced in the Autumn Budget 2024. The responsibility to account for Pay As You Earn (PAYE) tax deductions will move from the umbrella company to the recruitment agency supplying the worker (or end-client if there is no agency). The government will also be defining umbrella companies “to allow for their regulation and to bring them within scope of the Employment Agency Standards Inspectorate’s (and subsequently, the Fair Work Agency’s) remit, through an amendment to the Employment Rights Bill.”

How the agencies new responsibility to account for PAYE will work is yet to be determined, and there are many unanswered questions about who the “deemed employer” is and which PAYE reference code will be required when processing payments for contingent workers.

While the frustrating reality is that the supply chain must wait to learn more, there are plenty of initiatives that recruitment agencies can start implementing now – to ensure they’re best prepared for what lies ahead.

Giles Gibson, a Director at StoneBridge Pay, shares his views on the upcoming changes, including the introduction of umbrella company regulations:

“Unethically motivated umbrella companies have been promoting tax avoidance for too long now, costing the government billions in tax and National Insurance Contributions. Not only have criminally driven businesspeople made vast amounts of money, but honest, hard-working contingent workers are being referred to tax avoidance schemes, often with no idea that it’s happening.

The introduction of umbrella company regulations is long overdue, and I am pleased that it is finally happening. However, like many historical developments in this sector, the government’s most recent announcements have created more questions than they have answered.

Rather than speculating and contributing to the online rumour mill, I’m actively catching up with agencies and discussing the facts. A compliant PSL has always been important, but now it is essential.

As an ethical payroll provider with an in-house Compliance Department, StoneBridge Pay is set up to provide ongoing support for agencies. Whatever twists and turns are ahead, we will continue to provide the best advice and service to support agencies and contractors in the build-up to and beyond April 2026.”

Contact us for more information

With compliance at the heart of everything we do, Stonebridge Pay is an FCSA accredited umbrella company trusted by hundreds of recruitment agencies and end-hirers throughout the UK. Every week, we process payments for thousands of temporary workers, and we’re continuing to appear on a growing number of Preferred Supplier Lists.

Please call 020 4591 2677, contact your Account Manager or email [email protected] to learn more about Stonebridge Pay and the many benefits of referring your temporary candidates to us.

Stonebridge Pay – Payroll Built Around You.