Schools & Nurseries save somewhere between £18 – £25 per day booking supply educators from agencies that use umbrella companies. 

But do you know why?

By outsourcing payroll and employment responsibilities to third-party umbrella firms, these agencies avoid costs like employer National Insurance and pension contributions by passing them on to the educator.

The agency and umbrella company make more money, meaning the educator makes less. 

But here’s the thing: it’s not just the educator who loses out.

Sure, you’re saving £18-£25. But the agency and umbrella are putting at least five things at risk that are far more valuable to your school or nursery. 

Want to see them?

1. Your Partner Isn’t Your Partner 💔

When agencies use umbrella companies, the legal employer of the supply educator isn’t the agency – it’s the umbrella. So, when issues arise around supply educator pay, performance, compliance, or anything, really, who do you work with to sort things out? Do you know your agency’s umbrella?

It’s just one of the reasons why the UK government announced that, starting April 2026, recruitment agencies will be held responsible even when using umbrella companies.

2. Misleading Educators 🤬

Umbrella agencies often (if not always) mislead educators over how much they will earn in recruitment, by as much as £15 – £35 per day.

But the educators often won’t discover this deception until they’ve already started work, potentially in your school or nursery. It’s why the National Education Union claims umbrellas drain funding from education, providing no value to education, yet profiting from it (by as much as £150 million per year).

3. Upsetting Educators 🥺

What happens when your new supply educator learns they’ve been misled over pay? They may feel disheartened. Disappointed. Frustrated. Is that the mindset you want for your educators?

It’s one reason why the National Association of Schoolmasters Union of Women Teachers (NASUWT) expressed concerns about the growth of umbrella companies and the lack of transparency regarding their operations.

4. Losing Educators 👋

The issues stemming from umbrella agency arrangements can lead to a revolving door of supply staff, making it challenging for your school or nursery to maintain consistent teaching quality. 

Frequent supply staff changes can disrupt student learning and place additional burdens on your permanent staff.

 It’s one reason why the NEU encourages educators not to work for umbrellas.

5. Liability and Reputational Damage 👀

The UK government claims there is widespread non-compliance from umbrellas. Non-compliant umbrellas can engage in tax avoidance schemes, potentially leaving educators with unexpected tax bills and schools & nurseries entangled in reputational risks. 

This is prompting legislative changes to shift tax responsibilities to recruitment agencies and end clients in April 2026. 

But if something is wrong tomorrow, isn’t it probably wrong today?

You have all the power

Umbrella agencies often mislead educators over pay while potentially putting foundational pieces of your school or nursery at risk.

But you don’t have to use them.

Humly as well as hundreds of traditional supply agencies use the UK’s PAYE system to ensure educators get fair treatment, pay, and that schools & nurseries take on no added risk addressing their supply needs.