Managing Your Agency Supply Chain

Almost every care provider will, at some point, need to bring in agency staff to cover rota gaps. However well you manage your workforce, sickness, holidays and last-minute absences can leave you short. Many providers aim to minimise agency use, and rightly so, but the reality is that it will happen.

When it does, the stakes are high. The agency staff walking into your home may not be known to you, yet they will be asked to provide care and support to vulnerable people.

In Scotland and Northern Ireland, staffing agencies are more tightly regulated, and in many cases must hold a registration in order to operate. This helps provide a greater degree of oversight. However, the position is very different in England and Wales, where there is no such requirement. In fact, even if an agency wanted to register, it could not.

Both the Care Quality Commission (CQC) in England and the Care Inspectorate Wales (CIW) stopped registering staffing agencies in 2010. Any agency claiming to be CQC or CIW registered is therefore misleading you, as the registration will usually relate to a different part of their business such as domiciliary care rather than agency supply.

This means the responsibility sits squarely with you, the care provider, to ensure your staffing supply chain is safe, compliant and well-managed. While you can contractually pass certain responsibilities to agencies, you cannot pass all legal liability. The Home Office and HMRC can still hold the provider accountable, especially if it appears you have turned a blind eye to non-compliance. In short, if you benefit from the work, you share responsibility for how it is delivered.

At Florence, we review and audit hundreds of agencies every year. Here are 10 of the most common pitfalls we see, and how you can protect yourself.

1. Right to Work and Visa Rules

Students and skilled workers on visas can only work within strict limits. If agencies are not tracking hours or job roles properly, both they and you could be in breach of immigration law. Always check that agencies have robust processes to verify right to work and monitor visa restrictions.

2. Training and Worker Verification

We frequently see training certificates that look legitimate but on closer inspection include phrases such as “done in-house” or “assessed internally”. These need careful checking. Always verify that agency workers have up-to-date, externally validated training in mandatory subjects like moving and handling, medication and safeguarding, not just internal sign-offs.

3. Masquerading or “Ghost” Bookings

If someone turns up who is not the person you booked, stop the shift. Substitution or ghost booking is a serious safeguarding risk and a major compliance breach. Always insist on verified worker identification and audit logs.

4. Contracts

Do not just sign the agency’s terms and conditions without reading them. Many are out of date or do not reflect current legislation. Make sure you understand your obligations, especially around liability and worker status. Even better, have your own template agreement that reflects your policies and compliance requirements.

5. Employment Models

Be clear about how agency workers are employed. Many agencies now use umbrella companies or self-employed models, which can create risks if not properly managed. These arrangements can affect PAYE, IR35 and VAT obligations, and if HMRC later deems the model non-compliant, both the agency and the care provider could face backdated liabilities. Always ask for evidence of employment status, how PAYE and pensions are handled, and whether the structure aligns with current legislation.

6. Minimum Wage

Check that agency staff are actually being paid at or above the National Minimum Wage. Some agencies advertise low net rates that fall short once deductions are applied, or even charge fees to their workers for things like payroll, uniform or admin costs. This is unlawful and exploitative, and any provider linked to such practices could also face reputational or legal risk.

7. Holiday Pay

Holiday pay must be paid to workers, not rolled up or held back. If agencies are not handling this correctly, you could inadvertently be complicit in underpayment. Always ask agencies to confirm how holiday pay is calculated and paid.

8. Pensions

Auto-enrolment is a legal requirement. Any agency forcing or encouraging workers to opt out of a pension scheme is acting unlawfully and unethically. Do not tolerate it, and make sure your agencies can evidence compliance with pension rules.

9. Late or Withheld Pay

It is illegal for agencies to delay paying workers until they themselves are paid by the client. Workers must be paid on time, regardless of your payment cycle. Late or withheld pay can also drive good workers away, harming continuity of care.

10. VAT Irregularities

Some agencies avoid VAT registration or misapply VAT rules to make their rates look cheaper. This is a red flag and could expose you to risk if HMRC investigates. Always ensure invoices are compliant, transparent and clearly state the VAT position.

These are just some of the key issues. In our experience, most problems stem from lack of knowledge rather than bad intent, but the barriers to starting an agency are low and a small number of bad actors can cause serious harm.

Whether you are a small provider or a large group, you are responsible for your agency supply chain.

If you need support, Florence can help. Our Neutral Vendor solution manages and audits agencies for you, ensuring compliance, fair pay and peace of mind. Or, if you would prefer to keep direct relationships with agencies, we can carry out independent supply chain audits to give you a clear picture of where the risks lie.

As specialists in care staffing and workforce management, we know where to look and what to ask. Many of the tricks used by bad actors are subtle and easy to miss unless you know what you are looking for. With Florence, you get complete visibility and confidence that every agency and worker in your supply chain is compliant, fairly treated and safe to deliver care.

We also facilitate over 100,000 hours of care every week, giving us a clear view of fair market pricing across the UK. We can help you benchmark your current rates to identify whether you are paying too much — or if rates seem unusually low, whether that might indicate poor employment practices or non-compliance within your supply chain.