Healthcare contractors are at significant risk due to a lack of awareness of fraudulent activity in the outsourced payroll sector, warns Martin Innes, the newest board member at the Payroll Compliance Authority (PCA).

Martin's extensive background in the healthcare sector, including data-led senior leadership roles at various private and NHS organisations, has given him invaluable insights into how the growing volume of agency staff operate in the UK and the sector's reliance on umbrella companies to handle the payroll function.

Concerned about the risks posed by fraudulent umbrella companies to the UK's healthcare contractors, and particularly lower paid workers such as healthcare assistants, Martin decided to join the PCA board and lend his expertise to the outsourced payroll accreditor, which is seeking to protect workers and recruiters from unscrupulous suppliers.

Martin says: "The use of a large volume of agency workers in the NHS and our private healthcare sector has been increasing for a number of years due to the attraction of higher pay and more flexible working that contracting offers.

"As we recover from the impact of COVID-19 on the NHS and wider healthcare sector, we will only see a rise in demand for contractors as our providers work to reduce waiting lists and deal with an increasing elderly population. This means many of our healthcare workers will explore the contractor avenue, possibly reducing their full-time hours to take on contract work or leave the sector all together.

"But what many contractors are unaware of is the real risk that they will be exploited should they come on the books of an umbrella company that is taking advantage of its contractors. I've seen it happen and our healthcare workers should not find themselves stung by a large and unexpected tax bill because, unknown to them, the company that manages their wages is profiteering from a tax avoidance scheme and have not paid the taxes that were due."

Martin is a data expert, strategist and policy maker with extensive experience of delivering large-scale structural and cultural change projects in the public sector, including the NHS, with a focus on improving efficiency, financial management and overall performance.

Among his varied experience, he led a team that facilitated an NHS cost reduction of £1.24 billion in agency staffing spend and, during the pandemic, he directed a team of data specialists to provide insight and clear advice to ministers and key decision makers from COVID-19 surveillance studies. 

Aware of the proliferation of fraudulent activity in the outsourced payroll sector, with approximately 800,000 workers paid by umbrella companies in the UK, and the ongoing lack of official regulation, Martin felt impelled to try and right this wrong.

He adds: "Whilst the majority of umbrella firms are operating legitimately, there are still a worrying number or fraudulent operators. By joining the PCA, I hope to be part of the solution to end this exploitation of innocent workers."