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IR35: Royal Mail contractors to lose independent status and pay umbrella fees

Photo Source: Royal Mail
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The Royal Mail will likely place its off-payroll workforce, even those with a questionable or ‘likely’ inside IR35 status, into pay-as-you-earn (PAYE) working arrangements by this April, the company has confirmed with Computer Weekly.

The company will either add off-payroll workers on its own payroll or request those affected to provide their services in future via a PAYE umbrella firm.

“In preparation [for the reforms] we have undertaken initial assessments, on both an individual and role basis, and as part of that review Royal Mail is moving those we believe are likely to fall inside onto PAYE arrangements,” a spokesperson said according to the Computer Weekly report.

How much are umbrella fees?

Average umbrella company fees can run on average £25 – £30 per week or £80 – £130 per month, depending on the benefits you have opted for, such as sick and holiday pay or a pension scheme. These fees are usually taken out before tax.


How does the Royal Mail’s parcel pick-up service work for online sellers?

In October 2020 Royal Mail launched a parcel pick-up service across the UK in what it called “a shake-up of the daily round”. 

The service – Parcel Collect – means postmen and postwomen will now be able to collect parcels as well as deliver them on their daily round. It is one of the biggest changes to the daily delivery since the launch of the postbox in 1852.

The move means that online sellers and online shoppers will no longer need to leave the comfort of their home if they want to mail or return a pre-paid item by post.

Postmen and postwomen will collect a parcel from the customer’s door or nominated safe place for 72p per parcel, in addition to postage costs. Parcel Collect is also available for pre-paid return items at a cost of 60p per item.

Royal Mail can collect up to five parcels per address. Parcel Collect is available six days a week (check for special occasions) and can be booked up to five days in advance and up to midnight the day before. 

New postie uniforms

In other Royal Mail news, there will be a 12- week trial of a new, modern uniform for postmen and postwomen, designed to better suit contemporary delivery rounds.

The new uniform, based on the feedback and preferences of postmen and postwomen across the UK, will be trialled over a twelve-week period on a range of delivery rounds in selected areas across the country from Aberdeen to Torquay.

Royal Mail Contractor Salaries | Glassdoor

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