A Key Information Document or KID as it is being referred to is a document which recruitment agencies will be obliged to produce from April 2020. It is yet another change which is coming in this year which will add to the administrative burden faced by some recruiters.
A Key Information Document needs to be provided to a worker before an agreement is reached and a formal contract is issued. The aim of the document is to ensure openness in the supply chain and make it clear to all parties what deductions will be made and what fees will be charged. It should help to avoid any misunderstanding particularly surrounding umbrella company margins and deductions such as National Insurance and Employers’ National Insurance.
The KID will be the responsibility of the recruitment agency and will need to be provided to any limited company contractor or umbrella contractor.
What will the Key Information Document contain?
For limited company contractors the document will need to include the following:
- Key information about the relationship between the employment business and the jobseeker
- details of pay and deductions, including any benefits
- a representative example remuneration statement which clearly and accurately illustrates the pay the contractor can expect to receive
For umbrella contractors the document will also need to include the above, plus the following:
- details of any fees or margin charged by the umbrella company for the provision of their services
- details of employment costs such as Employers’ National Insurance, apprenticeship levy etc
- details of any additional employment benefits which the umbrella workers may be entitled to such as
- holiday entitlement
- sickness pay
- pension scheme
Whilst at the moment this will seem like another additional piece of paperwork for agencies and contractors to contend with, it will be welcomed by others as it will provide workers with all the facts relating to their pay and net take home pay after costs and deductions have been made.
A guide to providing a ‘Key Information Document’ for agency workers is available on the gov.uk site and can be found here
As always at Exchequer Solutions we will be working to minimise the impact of this change on our recruitment agency partners. If you are a recruiter and have any questions about the introduction of the KID please get in touch.