21 Aug How to Not Be Financially Abused by Agencies
Since COVID, healthcare recruitment agencies have put ridiculous markups on shift wages, up to 90% more to maximise their profit margins. This was a response to major staffing shortages faced by care homes and hospitals alike in the UK, and indeed around the globe. Jobs were lost, care centres closed, and the majority of healthcare providers had no clue they were being abused by the very agencies that had promised them excellent service. Years later, institutions are still recovering, some still oblivious that they still pay unnecessarily exorbitant rates.
Agencies do this to balloon their profit margins by charging hidden fees for services like DBS checks and admin candidates need for agency work, providing untrained or inappropriately licensed workers, and leveraging the healthcare worker shortage to demand sky-high fees. Watch out for suspiciously high placement fees, those higher than what is proportionate to workers’ average salary, opaque fee structures, frequent turnover, and disadvantageous terms for workers and institutions.
This post discusses current market rates in healthcare recruitment agencies and UK-tier contexts and how to budget for agency costs. We’ll also discuss how to discern whether you’ve been abused, are being abused, and what to do about it.
Agency Worker Market Rates
Markups placed on healthcare agency workers vary by various factors, including specialisation, cost of living, experience, night and public holiday shift patterns, demand, and agency size and reputation. It’s important to note that market rates fluctuate often, often in proportion to inflation and the healthcare service climate.
More experienced workers who are more educated are always in demand, and so demand higher rates. In addition, shortages and demand in certain areas, particularly understaffed and especially rural regions, may make for higher rates. Moreover, service level– additional services like accommodation or travel allowances for workers–may affect markups.
Wage Markup Fluctuations by Tier
Agency wage markups can fluctuate by tier– that’s availability and reputation. Let’s discuss agency tiers and how they affect how much you’ll dish out for service providers.
Tier 1
Tier 1 agencies can provide workers with as little as 24 hours, or even 1 hour, notice. Tier 1 workers must sign a contract with their agency.
Tier 2
Workers in tier 2 have 48 hours or more notice before they must work a shift. They are also contractually bound to their agencies. This is for roles where immediate availability is not required, but a relatively short turnaround time is still needed.
Tier 1 and 2 agencies usually command higher markups because of the short notice and relatively immediate availability they offer.
Tier 3
In tier 3, workers have 3 days’ notice, suitable for roles that require maximum flexibility in their schedule and immediate availability is not a requirement. Tier 3 agencies usually offer more competitive rates because they are not as in demand.
Tier Frameworks
Tiers are often structured into frameworks: tendered and off-panel. Tendered agencies have been formally selected by healthcare institutions, typically involving a bidding process where agencies bid for the contract. Agencies that have been tendered have limited ability to mark up wages because of contractual obligations and agreed-upon terms.
Tiers can also be off-panel. These tier agencies have not been formally tendered but are still used by an institution. They’re used as backup or to cover things that tendered agencies don’t cover. Off-panel workers may be more costly, as agencies can determine their wages because they are not contractually bound. Agencies that aren’t tendered might excessively mark up wages, as they are not bound by a contract. This is to compensate for the lack of guaranteed work.
Note that healthcare workers with specialised skills, like NICU or CCU nurses may have higher markups regardless of their tier. Markups vary by location, economic health, and an agency’s business model.
What to Do if an Agency Has Abused Your Institution
You must speak up if you feel a recruitment agency has wrongfully charged you. Collect all documentation that supports the claims of abuse, such as contracts, invoices, emails, and communications with the agency. Then, investigate the matter internally to assess the extent of the damage. Consider consulting with an attorney or consultant for help with this. Alternatively, consider mediation or conflict resolution.
After you have ascertained the nature of what went wrong, speak to the agency, clearly outlining concerns and allegations. Mention the action you will take and make an effort to collaborate in finding steps forward, especially if what they have done involves violations of relevant laws or regulations, and report the matter to the appropriate regulatory bodies, like the REC and CQC.
It’s important to understand tier structures and frameworks, as well as economic and social factors that influence wage markups so you can appropriately select an agency that aligns with your budget and values as an institution.
Proximity Healthcare charges £4-5 on top of average hourly wages, instead of the exorbitant £10 that other agencies usually charge. If you would like help sourcing workers of all tiers and frameworks, contact Proximity Healthcare. We would love to help you streamline the recruitment process and source top-quality and experienced workers who go above and beyond the gold standard.