Guide to direct payments for parents and carers

Getting ready to be an employer

If you decide to employ a carer yourself, you will become an employer and must take on all the legal responsibilities that come with it. The direct payment team can assist you with these tasks and responsibilities, including:

Recruitment

• Advertising for the position.
• Creating a person specification and job description.
• Interviewing candidates.

Pre-employment checks

• Checking the right to work in the UK – You must have evidence of your worker's right to work in the UK and keep a signed, dated copy (e.g., UK or EEA Passport, visa, work permit).
• Taking up references.
• Getting a Disclosure and Barring Service (DBS) check – It is the policy of H&F Council that anyone working with children, including those paid through a direct payment, must have a satisfactory DBS check.

Setting up as an employer

You will be responsible for offering a contract to your worker, called a Statement of Employment. This explains what you can expect from your carer and what they can expect from you. You must have two copies, one for you and one for your employee signed by both parties. Templates are available to help you with this.

You will also need to buy employer's liability insurance. H&F Council can arrange this for you, and it can be paid directly to the insurer by the council, separately from the direct payment. Alternatively, you can arrange this yourself and be reimbursed the cost into your direct payment account.

Your responsibilities as an employer

• Registering as an employer with HM Revenue and Customs (HMRC) and making HMRC contributions (tax and national insurance) on behalf of your employee. You can register with a payroll service to handle this on your behalf, and use your direct payment to pay for the payroll service.
• Providing and keeping timesheets and payslips – Many payroll companies will support you with this.
• Providing a pension to eligible employees – Many payroll companies will support you with this, and fees will be included in your direct payment.
• Providing paid annual leave – All staff, regardless of the hours they work, are entitled to paid annual leave. Currently, this is 5.6 weeks pro rata annually. Many payroll companies will help you track your annual leave obligations. You will need to budget for alternative support while your worker is on leave.
• Paying staff through bank transfer or cheque – Cash payments are not permitted. Many payroll companies provide this as part of their service.
• Keeping employment records for seven years – Many payroll companies will keep these records.
• Making health and safety arrangements.
• Arranging training for your employee as necessary. Training can be accessed through The Stephen Wiltshire Centre; please talk to your worker for further details.
• Specialist skills - If your workers role includes any specialist skills such as Moving and Handling, the parent or carer must share the manual handling or other plan and ensure appropriate training, fitness to work form is completed
• Providing supervision and support for your staff. Please discuss this with the direct payments team.

In exceptional circumstances, if all workers you employ earn less than a certain amount in any single week, have no other paid employment, and are not receiving any taxable benefits or pensions, you may not have to register as an employer with HMRC. Please discuss this with the direct payments team.

Pay for direct payment workers

H&F offers direct payment to pay your child's worker at least the London Living Wage (LLW)

From 2025–2026, the council will automatically increase this payment each year to match any changes in the LLW. The council will also tell payroll companies to pay the new rates.

The amount of money you receive is agreed during your meeting with your social worker, social care worker or keyworker and confirmed at the appropriate funding panel.

You will usually get two payments:

1. One for wages and paid holiday
2. One for employer costs (like payroll, insurance, pensions, training cost if needed etc.)

Your payment statement will show:

• One line for worker's pay + holiday pay
• One line for employer costs

Current standard and enhanced rates

For new families, these are the payment worker rates in 3 bands for the period 2025-2026:

• Standard (London Living Wage) - £13.85 an hour gross
• Enhanced (London Living Wage + 25%) - £17.31 an hour gross
• Specialist (usually children with complex with health needs)- Rate individually agreed

The standard rate will set to enable families to pay London Living Wage (£13.85 an hour gross) the enhanced rate will be at approximately 25% higher (£17.31 an hour gross) and there will be a third, specialist rate for other circumstances.

For families currently employing workers, direct payments pay rates will be discussed and reviewed with families at each planned review point as usual.

Disclosure and Barring Service checks

• If someone is registered for the update service and provide the details, they will not need to complete a whole new check.
• If you are employing someone through an agency, the agency must complete this check.
• The council will complete the check for anyone you employ through direct payments to work directly with your child. If the worker has a satisfactory DBS completed elsewhere within the last three years, a risk assessment can be completed and if appropriate they could start work whilst H&F complete the new check.
• The council will also pay for DBS checks. This funding will not come out of your direct payment account.
• Before direct payments workers can be employed, your social worker must be provided with the DBS certificate number and date of issue, or update service reference number so they can review the results of the check.
• Checks are completed for all workers paid through direct payments including family members, however in some special circumstances a waiver might be possible if agreed by the service manager.
• A risk assessment must be completed to inform decision whether to employ the individual if any convictions are identified through the DBS check.

If you don't want to employ a carer yourslef

If you don't want the responsibility of becoming an employer, you can purchase the services of an agency that will provide you with a worker for your child and organise all the recruitment, pre-employment checks, employer set up and take on the responsibilities of being an employer, including completing DBS checks. However, this may be more expensive than employing a worker directly.

The agency should not be one that charges a fee for introducing you to potential carers as the direct payment money cannot be used to pay for this.

If the agency provides personal care to your child, they must be registered with the Care Quality Commission (CQC).

I have found a carer who wants to provide services as self-employed

If a carer is self-employed, you will not be their employer and do not have to meet employers' responsibilities, other than the DBS. However, most carers will not meet the HMRC requirements to be classed as self-employed.

Check if a carer meets the requirements to be classified as self-employed on GOV.UK

You have a responsibility to obtain evidence from any person you employ as self-employed that they are registered as self-employed. Self-employed workers should also provide you with a statement of services and invoice you for services provided.

Please discuss this with your social worker if this applies to you.