Agency use

Agency use is strongly misunderstood by care homes. It is seen as the place to focus in order to curb expenditure, and is often blamed for poor financial performance. It is undeniably a contributing factor, however there is more to consider when aiming for appropriate recruitment. For me, agency use will always be a vital part of running a care home, although this can be tempered with the use of bank staff, overtime, and overstaffing.

When analysing cost of agency temps compared to regular staff costs, let us look at the figures. For each hour, minimum wage is currently £8.72. Add general employers’ costs such as training, NI contributions, Pension contributions, making circa £9.85ph. Also add on 11% holiday costs (5.6 weeks per year, adjusted hourly), makes £10.93ph, assuming the role is gapped. In reality, if agency is used, costs will be higher. Most agencies work for between £12 and £14 per hour. So the conservative true cost to an employer using agency is circa £2-3 per hour. Let us assume £3ph. This doesn’t account for the training, supervision, appraisal, HR management, and potential SSP/SMP (although I concede the latter may be reclaimable) payable to an employee. Agency use is therefore about 20% extra on top of

Now let us make a few assumptions. Annual leave accounts for 11% absence of staff, and sickness probably equates to around 3% (although it surely feels higher!). So are we better to hire 11-15% extra staff? I think it is generally a good idea to have a 10% leeway, however you cannot forecast sickness, and there are times of the year where people will be more or less inclined to take annual leave. This means there will still be times where we are requiring agency, and other times that we are overstaffed.

Where the extra staff come in useful is attrition. It can take 6-8 weeks from point of contact to starting a shift, as DBS wait times, training, induction, shadow shifts etc. This means that a staff member with a 4 week notice period (in the unlikely event they actually work it) will still leave us short staffed for the 2-4 weeks it takes to hire a replacement.

Having a strong bank of staff who will pick up work as and when required on a casual worker basis is a good answer to agency use, but this cannot be too large as we need to be able to actually offer shifts to these people, and they can turn down shifts quite easily. Overtime payments can incentivise staff, and I’d argue £1-1.50 is a good range, as it is both financially viable, and supports continuity of care for residents.

So my advice is pragmatic. We won’t (and shouldn’t) strive to eradicate agency use completely, as to do so would require a level of staffing that would be financially crucifying. Instead, aim to find a solid, reliable agency who can provide a few good, strong workers on an ad hoc basis. Look after each other, invite them to home training, supervise them, and integrate them fully into the team.

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