Please note this page is in the process of being updated. You can check back here for more information.

What is an Employment Agency?

You can either run your company as an Employment Agency or Employment Business. HMRC have the best definition of the differences on their page here:

https://www.gov.uk/employment-agencies-and-businesses

Do I have to run as an Employment Agency with TutorCruncher?

With TutorCruncher, you can either be an Employment Agency, an Employment Business, or a hybrid of the two.

What rules do I have to follow in order to be an Employment Agency?

For charges where you are acting as an Employment Agency, there are some key rules that must be followed:

  1. Your tutor must be in control of the flow of funds. For this, we have built our Split Payments feature. Find out more.

We are in the process of updating this information. For now, you can find out more information from The Tutors' Association. Most of the information we update this page with (not related to how TutorCruncher works) will come from them.

What are the advantages/disadvantages of being an Employment Agency?

We are in the process of updating this information. For now, you can find out more information from The Tutors' Association. Most of the information we update this page with (not related to how TutorCruncher works) will come from them.

What differences are there in TutorCruncher if I act as an Employment Agency?

There are a few key differences.

Tutors are now in control of the flow of funds

In simple terms, if a company is acting as an Employment Agency then the tutor they are working with must be in control of the flow of funds. This means they must choose when the client is sent a Payment Request (the email a client receives asking for payment/informing them payment will be taken automatically off their card).

To facilitate this requirement, when a tutor is marking a lesson as complete, they will be asked to confirm whether it can be billed for. If the tutor confirms this then the Payment Request will be sent out to the client. If the tutor declines this option, then the lesson will appear on their Dashboard as ‘Uninvoiced’ and they will have the option to send the Payment Request from there. The tutor will then be able to see whether or not payment has been made.

If you are using Auto Invoicing, then this isn’t a big change to your business model. You won’t be able to turn this on and off on a client by client basis; any lessons being processed under the EA model will use this functionality.

If you still currently process invoices in batches, then this is a bigger change. We have been transitioning some of our clients from batch invoicing to per-lesson invoicing already and we’ve gotten very positive feedback on the change so far. The benefits which have been reported to us include:

  • Quicker cash flow - Since the client pays after each lesson, you’ll receive your money much sooner.

  • Happier tutors - Your tutors will be able to see exactly when a lesson has been invoiced, whether it’s been paid and when they’ll receive their funds.

  • Less bad debt - You and your tutor will be able to see when a client hasn’t paid immediately, instead of them going through a month of lessons before you find out.

  • No payroll/invoicing - It’s all automatic, huge time saver!

  • Less refunds/invoice queries - Your clients won’t have to review a long invoice before they confirm payment; the payment request will contain one lesson.

Further to this feature, since the tutor has to be in control of funds, they will have the power to refund Payment Requests generated this way.

Where this feature might differ to your current workflow is that you will no longer be able to send a Payment Request for more than one lesson at a time. In future, we may allow tutors to send batch Payment Requests, but it will always be limited to just the lessons a client has had with that particular tutor.

How do I set up TutorCruncher so that I am operating partly/fully as an Employment Agency?

If you go to System > Settings > Accounting Settings > General, you should see an option for "Operate as an Employment Agency". Tick that to enable operating at least partly as an EA.

Once that is checked, you'll have the option for "By default, you operate as an Employment Agency with each client". This lets you choose if, by default, you will be operating as an EA for each client. This is a default, and can be overridden per client (see below).

Please note that enabling this option will enable Split Payments. Learn more about Split Payments.

How do I act as an Employment Agency/Employment Business for certain clients?

If you go to a client's page and click Edit, there's a field under Accounting Settings for '"Operate as an Employment Agency" override'. This lets you choose on a per client basis whether to act as an EA or EB for that client.

Please note that you must have "Operate as an Employment Agency" enabled in System > Settings (as per above) for this option to show.

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