Is Your Construction Recruitment Agency Charge Rate Really Sustainable?
With rising costs across the construction industry, it’s no surprise that agency charge rates are under closer scrutiny than ever. Every business is watching its margins, and on the surface, a lower hourly rate can look like an easy win.
But in today’s compliance driven environment, the more important question is this: what sits behind that rate, and does it genuinely stand up to scrutiny? Low cost does not automatically mean low risk, and a cheap rate rarely stays cheap for long.
As a construction recruitment agency in Birmingham, we regularly speak to businesses who are reassessing their labour supply strategy and discovering that sustainability matters more than headline price.
Why Cheaper Rates Can Cost More
There is a common assumption that the difference between a worker’s pay rate and the agency charge rate represents agency profit. In reality, that gap includes unavoidable legal and statutory employment costs attached to every PAYE temporary worker.
These costs include employer National Insurance, holiday pay, and pension contributions.
When a charge rate looks unusually low, it is worth asking how those obligations are being covered. If statutory costs are not being factored in transparently, they are often absorbed, avoided, or pushed further down the supply chain. That is where financial, legal, and reputational risk begins to creep in.
The Hidden Risks You Don’t See
Many businesses do not revisit how their temporary workforce is paid once an agency relationship is established. However, payroll structures matter, particularly where intermediaries or mini umbrella arrangements exist anywhere in the labour supply chain.
HMRC has significantly increased its focus on labour supply chains in recent years. If something further down the chain is not operating compliantly, it is often the end client who is left answering difficult questions later. That risk does not disappear simply because it is outsourced.
For companies relying on construction recruitment in Birmingham, visibility and control are essential.
Compliance Is About People, Not Just Payroll
Charge rates do more than fund recruitment delivery. They also help ensure workers are protected, treated fairly, and employed ethically.
As a labour provider, we are on the front line of safeguarding workers and supporting the intent of the Modern Slavery Act. Ethical recruitment, transparent processes, and strong compliance controls all play a role in reducing the risk of labour exploitation.
Reasonable care today is not about ticking a box. It is about being able to evidence that your labour supply chain is actively managed, compliant, and accountable.
Compliantly Competitive by Design
At Extra Workforce, we believe competitive pricing and strong compliance should go hand in hand. We do not win work by cutting corners, hiding detail, or shifting responsibility elsewhere.
Our approach is simple. We operate transparently, manage risk proactively, and take full ownership of our processes because protecting workers and protecting clients are part of the same responsibility.
As a trusted construction recruitment agency in Birmingham, we focus on long term partnerships rather than short term savings.
The Bottom Line
If you have not reviewed your agency’s payroll model, compliance processes, or labour supply chain recently, now is the right time to ask the questions. Sustainable recruitment is not just about today’s rate. It is about confidence, continuity, and peace of mind long after a placement begins.
At Extra Workforce, all payroll, compliance, and auditing processes are managed in house. This gives our clients full transparency, clear audit trails, and genuine confidence in their labour supply chain.
If you are looking for a recruitment partner where compliant PAYE, due diligence, and accountability are the standard rather than optional extras, we are always happy to have a conversation.