The Bottom Line
- The assignment rate is not your salary. It often includes employer costs and umbrella margin before you see taxable pay.
- Compare offers like-for-like by requesting a clear breakdown and reconciling to your payslip.
- Holiday pay can be advanced or accrued — understand which you are on.
- If an umbrella promises implausibly high take-home, treat it as a red flag, not a bargain.
- Ask for the Key Information Document (KID) so you can compare deductions across roles.
The simple truth
Umbrella work is PAYE. Your take-home depends on how the assignment rate is converted into gross pay after employer costs and umbrella margin.
Assignment rate vs taxable pay (why doctors feel misled)
Clinicians commonly hear “£X per hour” and assume that is gross pay. Under umbrella arrangements, that headline is often the assignment rate paid by the end client/agency — from which employer costs and fees can be deducted before your taxable pay is calculated.
Your job is to force transparency: request a breakdown that maps to your payslip.
How to compare two locum offers properly (5 questions)
1
1) Is the headline figure assignment rate or gross pay?
If it is assignment rate, ask for the conversion to taxable pay with employer costs itemised.
2
2) What is the umbrella margin and is it fixed?
A transparent margin is normal. Hidden or variable fees are not.
3
3) How is holiday pay handled?
Is it advanced each payslip or accrued? Either can be fine; confusion is the enemy.
4
4) What pension deductions apply by default?
Confirm if you are auto-enrolled and what the default settings are.
5
5) Can you provide a worked example payslip/reconciliation statement?
You want a worked example that reconciles: assignment rate → costs → taxable pay → deductions → net.
Red flags
• ‘Guaranteed’ unusually high take-home
• Vague or missing breakdowns
• Pressure to sign without documentation
• Deductions that cannot be explained calmly
Your default posture: if it is not explainable, it is not acceptable.
SourceGOV.UK — Umbrella companies: guidance (official)
Open Link SourceGOV.UK — Key Information Document (KID) requirement (official)
Open Link