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MAY 22/2019

Agency Nursing Pay Rates: Update with Medacs Healthcare Director of Staffing

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As an agency nurse, you will no doubt hear a lot about pay rates. These conversations can sometimes be difficult to decipher, especially when factors such as frameworks, pay caps and escalated rates (to name but a few) come into play.

There are plenty of questions that need answering on the subject of agency nursing pay rates, including why some are available and others aren’t, who determines these rates and what the future holds for pay rates.

Fortunately, Trish Davidson, Medacs Healthcare’s Operations Director of Specialist Staffing, is someone who specialises in agency nursing pay rates and is more than happy to separate fact from fiction.

Why are we unable to publish our pay rates in England, as we can for Scotland and Wales?

“Unlike any other framework agency, we are on all five available frameworks in the UK, three of which are focused in England. While this gives our nurses in England a great variety of work options, it does make managing rate cards tough because things are constantly changing due to supply and demand.

So, for instance, in some hospitals where we have a tier one contract, which essentially means our nurses get first sight of all available agency shifts, we’ll operate rate cards that may actually be lower than the capped rates.

Conversely, hospitals in remote locations that struggle for staff, escalate their rates to attract nurses who are willing to travel. There are also scenarios where we operate multiple rate cards as a means of keeping the agency staff who were historically paid high off-framework rates. A trust will be reluctant to lose such workers so keep the rates high.

Rates also vary with seasonality. For example, demand for staff increases around October due to winter pressures. That’s actually when we first started to see rates escalate outside rate caps. The opposite occurs in the summer, when demand dips slightly along with the rates. So it’s all about supply and demand.

Scotland and Wales are different. Their rates are flat, so it’s easy for them to stick to one rate card, but England operates varying rate cards that change constantly. In England, we may have a handful of rates for one framework and more than 20 for another. It’s not unusual for us to manage more than 70 rate cards at any one time for England.”

Agency Nursing Pay Rates

So, what’s happened to rate caps?

“NHS Improvement (NHSI) introduced the rate caps in 2015, which the NHS itself supported. The intention was that all nurses would earn exactly the same so that over time, we would see agency nurses flocking back to substantive posts in the NHS.

While there were some concerns, namely remote locations and high off-framework spenders, for a period of time all the rates were the same. But after a short time, we started to see large swathes of nurses either retiring or moving to the private sector or even overseas. While some nurses did return to staff banks, many went to work through off-framework agencies, which was the exact opposite of what NHSI intended.

This, of course, led to huge staffing shortages with hospitals going into red alert and escalating rates. And it wasn’t just the remote hospitals that were affected. Hospitals in seemingly primary locations were escalating rates. It happens now because, in today’s market, there are still not enough nurses to fill all of the demand.”

Do any hospitals stick to rate caps?

“Yes, there are still lots of hospitals that stick to the rate caps. These are the ones that already have a good strong bank service and they might be in a primary location. London seems to stick to its rates, rather than issuing additional rate cards or rates that are in escalation.

And some hospitals stick to rate cards but only for particular bands or specialities. Critical care, for example, is an area where it’s common to see rate escalations.”

Who decides whether to escalate rates?

“It varies. Sometimes the staff bank or the nurse bank will have the autonomy to decide. Sometimes it goes as high up as a nursing director or a medical director and then other times the framework will make the decision on the client’s behalf.

We had a winter pressures contract with a trust from October 2018 to April 2019. The nurses received escalated rates and were given six-month block bookings. The trust has since awarded us with a new contract until October 2019 where they’ve put a slight rate reduction in, but our nurses are still getting good escalated rates. The likelihood is that the client will end up with two rate cards; one for the winter and one for the summer.

With private and ad hoc clients, where we are not part of a tiered or managed service contract, our recruitment consultants will negotiate rates on behalf of our nurses. They’ll say, “I’ve got a nurse at band 6, she’s got 10 years’ experience with paediatrics but I’m afraid she won’t work for less than £35 an hour.” So there are some occasions where rates are flexible.”

Asian nurse with patient

By how much do rates tend to escalate?

“There’s no fixed percentage increase as it really varies depending on things like the band, location and what seasonal demand looks like. As an example, during October, November and December you might get paid £20 an hour. And in January, February and March, in the exact same shift, you might get £15 an hour.

Then there are trusts who escalate rates on a shift by shift basis. They’ll start with the basic NHSI rate caps, then if we can’t fill at that rate, the shift will go out at the last minute at an escalated rate. Sometimes, a trust will tell us that tonight’s night shift is going at the November rate and when that same nurse goes back to work the following night, it changes back to the capped rate.”

How have our nurses reacted to the constant fluctuations in pay?

“We think it’s been frustrating for them. Between rate caps in 2015 that affected all agency nurses and IR35 in 2017 that affected those paid via limited companies, we lost a lot of our nurses. It was no longer viable for them to work through an agency, especially if they held a substantive post.

It’s also really impacted how nurses feel about their careers. We’ve all seen the headlines where a nurse could actually earn more working in menal jobs. It’s been a tough few years for nurses.”

What does the future look like for agency nurses and pay rates?

“While we are seeing some recovery in the market in terms of pay for a nurse, it’s still a very unstable market.

It’s a struggle for agencies as we are constantly balancing the needs of our nurses and clients. On the one hand, we have a situation where the majority of trusts and frameworks don’t want to advertise they are offering rate escalations. On the other hand, the first thing a nurse will ask is “What are the pay rates?” So, while pay has become more of a motivator for nurses, as a framework agency, it is difficult to always offer the best pay rates.”

Find out more

If you would like to find out more about agency nursing pay rates, please contact our team in England and Wales call 01785 236 202 or call our Scotland team on 0800 442 215.

Alternatively, why not find out more in our Finance series?

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