The CEO of the Freelancer and Contractor Services Association (FCSA), Chris Bryce, has received a letter from the All-Party Parliamentary Loan Charge and Taxpayer Fairness Group (APPG) regarding holiday pay and cyberattacks on umbrella companies.
Just to let you know, the FCSA provides accreditation for compliance and is a membership organization for umbrella businesses, contractor accountants, and CIS payroll services.
The APPG is pleading with the body to deal with important issues affecting the sector. The first case in the list is Smith v. Pimlico Plumbers.
After it was determined that Gary Smith was an employee and that the right to paid leave could therefore be carried over, the Civil Division of the Court of Appeal decided that Smith is entitled to have vacation time retroactively granted.
Please take a look at the article BBC about the FSCA umbrella company: Check here
FSCA umbrella companies rely on not paying holiday pay.
The loan charge group emphasized that it had previously brought up the subject of "holiday pay being withheld by some umbrella companies" in its report on how contracting should operate, which was released the previous year.
It stated: "We would be interested to know how this impacts FCSA accredited businesses and whether any of them are subject to backdated holiday pay under the terms of this ruling.
Moreover, some umbrella companies may depend on not paying holiday pay as a part of their business model, according to media speculation.
The group went on to say that although it hoped this had not been the case, it still wanted the trade organization to "provide clarity on the implications for both umbrella firms and workers who use them."
On the other hand, a representative for the FCSA responded to the controversy surrounding holiday pay by stating: "The FCSA's updated code mandates that any holiday pay due must be paid to the worker if it is unused.
"FCSA members are required to remind contractors to take their vacations throughout the year and to give contractors at least one month's notice when their vacation year ends, giving them the choice to use their vacation time or receive full payment for any unused vacation days."
Loan Charge group asserts - Data leaks are seriously concerning
The cyber-attacks on accredited firms are the other issue that MPs in the action group want the FCSA to address. According to the APPG, these "have not only caused delays in payments but have also inevitably resulted in leaks of confidential data that are causing serious worry."
Trade body hires a cyber security specialist
The group commended FCSA for responding to its earlier letter by promising to look into the incidents, and it urged the agency to keep them informed and offer a solution to stop further assaults.
A spokesperson for the FCSA stated the following regarding cyber security: "The FCSA's codes of compliance demand adherence to employment and tax best practice, but we recognise that the prevalence of cybercrime is increasing globally and across all industries.
He further added, “To ensure that the industry can best defend itself against future cyber-attacks, we will continue to work with stakeholders and our members. This will include assisting members and directing them to outside expert advice”
“To strengthen our strategy and the recommendations we can make to our members, for instance about business continuity and disaster recovery after a potential cyber incident, we have also appointed independent cyber security experts” the spokesperson concluded.
Check social media links about FSCA: Check here
The statement from the spokesperson from FCSA, however, didn’t put much light on the following questions:
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Have any FCSA member businesses ever refused to pay employees their holiday pay when, by the Smith v. Pimlico Plumbers decision, they were entitled to it?
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Will any or all FCSA members voluntarily pay affected employees holiday pay by the Smith v. Pimlico Plumbers ruling?
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In the FCSA's opinion, were the businesses that had been the target of cyberattacks equipped with sufficient cybersecurity systems? Online rumours that they might not have been in some cases have probably caught your eye.
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How many FCSA firms, and which ones, have experienced data breaches that resulted in the compromise or leak of customer information?
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What steps are being taken by these businesses to determine the scope and character of any leaks, to alert clients or employees, and to address any issues that may have arisen?
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What steps are these businesses taking to stop future attacks?
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We observe that one FCSA member company has publicly stated that they have not dealt with the cyber attackers and will not do so in the future, stating that they will not be "held to ransom." Do you know if all FCSA member companies hold this position consistently and if so, would they all tell their employees the same thing?
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Can the FCSA guarantee that no FCSA company has paid the cyber attackers to fix the problems or stop the attacks?
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Has the FCSA provided members with any instructions or advice on how to handle these kinds of cyberattacks?
While these questions are yet to be answered, FCSA certainly has to take a detailed insight into the functioning and ethics of its umbrella companies.