The current state of play 

The COVID-19 pandemic has not only changed the location and timings of work, but also permanent employment, which is well and truly on the wane. As companies cut back on permanent, in-house resources, flexible employment has exploded. One in seven UK workers are now on flexible contracts, up 25% in two decades. The acceleration to flexible employment is spread across a wide range of industries, including construction, IT, healthcare, retail and logistics.

Powered by contractors and temporary workers, employers have the agility to respond to changing market requirements building bespoke workforces rapidly when and where they are needed. A critical element to the success and recovery of the UK as it progresses forwards with vaccination programmes and COVID-19 restrictions easing. Contractors are now specialists who deliver their expertise when in demand, across an array of industries, opening up the possibility for great rewards. 

Adding fuel to the temporary worker supply chain fire 

This growing segment of employment is fueling an expanding layer of companies between the company requiring the work and the specialist delivering. These recruiters, Professional Employer Organisations (PEOs) and ‘umbrella companies’, offer solutions to paying salaries to, and taxes on behalf, of contractors. 

However, the rapid evolution of working practices, with workers now demanding choice over how, when and even where they work, is moving at a much greater velocity than legislation. The UK government is trying to keep a reign on activity, recently implementing reforms to IR35 to provide clarity for off-payroll working. Plus, HMRC issued guidance for working via an umbrella company – a watershed moment for the temporary labour market. 

Despite best efforts, payroll and compliance issues are still apparent. These range from the correct handling of holiday pay, who’s inside or outside of the new IR35 changes and tax avoidance, whether it’s deliberate or accidental. 

Keeping on the right side of compliance issues in a growing supply chain for temporary workers’ payroll is highly complex, making regulation a mammoth task for finance teams to undertake. These complexities only rise with scale.

Quantum Employment 

The need for end-to-end transparency is vital to ensure both employer and employee can pay salaries, accrue pension benefits and submit regular returns and taxes. All parties need real time information, from ID checks to timesheets, CRM systems, cash matching and accounting ledgers. 

Yet, unlike the growing majority of their clients, many umbrella companies, recruiters and PEOs were not born digital. It just takes them too much time, and way too many people, to pay workers, with IT systems fragmented and thinly spread across teams. Keeping track of work as it becomes the smallest recordable increment, will muddle tax affairs for those flying blind with manual and legacy processes.

Cashflow and compliance are kings 

Compliant cash flow is what matters most to many companies and all contractors. Quantum employment’s cash flow issues start from the off, with painfully slow onboarding, and they persist due to poor record-keeping and lagging behind new legislation. Without the basic ability to pay out only when paid up, to respect contractual or credit agreements and to pay tax accurately, yet profitably, at scale, employers run the risk of cash flow collapse. 

Sure, in house IT and admin teams can stem the tide for a while. But without the scalability of born-digital quantum employment solutions, and faced with constant change, ultimately pre-quantum employment business models buckle. And consider this. In any market growing as fast as quantum employment, an alternative supplier is always just a click away…

Imagine though we did not start from here. Imagine a platform designed with transparency in mind which reduces the time and staff required to administer this complex new world of flexible employment. One designed to cope with the smallest element of employment – minutes on a timesheet. Where the time taken, and staff required, to match the day-to-day workforce management to financial accounting was as quick as a click.

We did just that. We call it Quantum Employment Design.  

Quantum Employment Design (QED) provides transparency and speeds up the core processes needed to manage tomorrow’s digital quantum employed workforce, because it was designed for it.  It empowers you to design your business and processes for the quantum employed workforce of tomorrow, not yesterday.

QED understands and adapts to process changes. It starts by providing an enhanced onboarding experience for individuals. It integrates with third-party systems including CRM platforms to remove friction from the payroll process and automates timesheets, invoices and bank matching across, and all the way through to, payslips and tax remittances. It does all this without employing an in house IT team or buying fast depreciating computers and their tiresome updates. 

With Quantum Employment Design, manual reconciliations go the way of hand-written timesheets and paper payslips. Remember them? 

QED works wherever teams are deployed and whenever they need to be enrolled, paid or taxed. QED provides protection from the disruption of legislative changes. It loves change. The more complex the better.

Tomorrow’s quantum workforce

My Digital is a pioneer in Quantum Employment Design and the leading SaaS supplier for tomorrow’s digital employers. Our background in accountancy, tax, human resources and SaaS software has allowed us to build out the most complete QED software suite for recruiters, umbrella companies, PEOs, pension providers, insurers and checking operators.

My Digital exists to serve the needs of the many and the few. We love the new workforce. We can clearly see this quantum employed workforce will demand more from those they exchange their skills and labour. Those who effectively employ them. Our vision is to make My Digital the platform for tomorrow’s labour market.