FAQWorking in the NHS: hourly paid locum work or salaried employment, which is best for you?
The NHS has vacancies for both hourly paid locums and salaried employees. Salaried doctors are directly employed by the NHS; hourly paid locums are contracted through an agency.
Each way of working has its advantages and disadvantages. This guide is designed to highlight the differences so that you can decide which suits you best.
First, some background.
Hourly paid locum posts are usually created when a salaried doctor goes on holiday, becomes ill or there is a gap between when one doctor leaves and a replacement doctor is scheduled to start. These posts can last for one day or up to a month – though occasionally some last longer than this (see note below). Salaried employment is generally offered to fill longer term gaps in a particular department – and typically lasts for 3 – 6 months or more.
Hourly-paid locum work – the pros and cons
As the NHS is such a large organisation, there are always a lot of hourly paid locum posts and a whole sector has grown up within the recruitment industry to handle them.
Most of the time, UK hospitals will only consider doctors who have already worked within the NHS and who have references from consultants in the NHS. Occasionally, hospitals will consider a doctor from overseas who hasn’t yet worked here – though typically at a lower pay rate / lower grade.
Hourly paid locums still need to pay tax. They are either registered self-employed with UK tax authorities or have their own limited company or work through umbrella companies.
As a general rule if you’re working this way you don’t build up any employment rights.
The advantages
The main benefit of hourly paid locum work is the pay rate. When you’ve got UK experience, you can assume that the locum rate is 40% to 50% more than the salaried rate (when worked out on an hourly basis) – see note below though on actual pay benefit. Of course, this will still vary according to your experience, the grade you’re working at and your speciality.
Another benefit is that as an hourly paid locum you will have the opportunity to visit different hospitals and regions of the UK. Plus, you may be able to choose when to work and fit it in with your family life / training / holidays.
The disadvantages
I’ll split these into two parts – general disadvantages for all doctors, including those who already have UK experience and disadvantages particularly for doctors new to the UK.
a) General disadvantages
- You won’t get access to the training courses, CPD (Continuing Professional Development) or the support of the consultants to help your clinical learning or career
- You won’t get as closely involved in the continuity of patient care or in the more complex treatments. If you are an SHO (or even a middle grade) surgeon, you may not get access to the operating theatre. In short you risk being treated as a “stop gap” – somebody to fill the gap in the rota doing the lowest grade tasks / less complex work.
- The actual pay benefit is not as high as the 40% to 50% that the raw pay differential suggests. Salaried jobs include paid holiday, training days and access to the NHS pension scheme. As an hourly paid doctor, you need to pay (or take time out) to sort out your own tax affairs and, of course, you can’t be sure that you’ll be able to work exactly when you want to, which means you may well be sitting around not earning, while waiting for a new job to come up.
- It’s a nomadic lifestyle. You are not part of the hospital team, you won’t get to settle in any one area, you have to live out of a suitcase
b) Disadvantages for newly arrived doctors
- The pay rate for a newly arrived doctor is only about 10% – 20% above the salary (and thus often not better paid at all, when you take paid holiday into account). It takes several weeks of work in the UK before you can get the higher locum pay rates.
- Hourly paid locums are expected to turn up at a hospital and start work with a minimum of induction or support. This is hard to do if you’ve not worked in the UK before.
- Your ability to get on-going work in the NHS is very dependent on the quality of references you get from your first employer. If your first job is short or ends unsatisfactorily, then you may not get adequate references. This can blight your career and make it impossible for you to get any more work in the UK (hourly paid or salaried).
- The bureaucratic requirements to set yourself up as a locum are a significant burden in terms of time and money – before you even start work here. When a hospital asks an agency for an hourly paid locum, they ask the agency to send a complete file of documents on the doctor (CV, copies of all medical diplomas, GMC certificates, proof of ID, references, health checks and police checks). Usually you’ll need to apply and pay for a UK CRB, which takes around 4 – 6 weeks to complete, as well as pay for ID verified blood samples to be carried out by a UK laboratory.
- Not all hospitals are of the same standard in the UK and as an hourly paid locum on your first (few) post(s) in the UK, it is difficult to know which is which and whether one hospital or another will be a good to work at or not.
Salaried NHS jobs
These are full time posts in a particular NHS hospital. They are typically for a fixed period (say 4 – 6 months). However, most are renewable for a further fixed period or can be turned into a permanent post. Even if the post is just for 4-6 months, this amount of experience will give you the reference needed to get a similar or better job at another hospital. Alternatively, you can move over to being an hourly paid locum after you’ve completed your contract.
The advantages
a) You will be treated as part of the staff team rather than as an outsider, just sent to fill a short term gap. As a result you’ll get help, support and training from the senior doctors as well as the other staff. There is usually a senior consultant allocated to supervising your clinical work, who will also be available to advise on training and career progression.
b) You have the chance to develop your clinical skills over the long term – particularly as you’re in secure employment (the NHS contract is likely to be initially for 6 months and then either extended or made permanent).
c) You work closely with the consultants and get the opportunity to obtain good references (references are essential to get other posts in the UK. The better the reference, the easier it is to get better jobs).
d) There is a generous pension system (the NHS pays in an extra 14% of your salary if you take part by allocating 6% of your salary to it) and you get sick pay.
e) Typically, there are 7 or 8 weeks of paid holiday per year and time is allocated for continuing professional development.
Note on salaries: Make sure you understand the full rate being offered for a salaried position in the NHS. It can be very difficult to work this out – the job descriptions and offer letters that the NHS sends out are rarely clear on exactly how much money you’ll earn each month. As a note: NHS salaries are governed by salary scales and banding supplements. Your salary scale will be based on the number of years of experience (as confirmed by “certificates of experience”). There may also be a “banding supplement” (for SHOs) which increases your salary by as much as 50%. You should also determine whether the salary is based on a 40 hour or 48 hour week (the latter is typical for an SHO) or, if you are middle grade / consultant, how many sessions it relates to.
The disadvantage
The pay is not as high in a salaried job as it is as an hourly paid locum.
Discussion of pay differences between hourly paid locum work and salaried work.
On the face of it, the headline difference between a monthly salary in the NHS and the hourly locum rate looks large. But remember, when you’re weighing up the differences in purely financial terms, salaried employment means you get paid holidays and sick pay.
Also bear in mind that when you’re not working, for instance when you’re waiting to start a new job, you’re not being paid.
There is also the NHS pension scheme, which at 14% is very generous.
Tax is always payable. It is easiest to assume an overall tax rate of between 28% to 32% (higher percentage for salaries over £65,000). If you are an hourly paid locum, you may get your tax rate slightly below this if you can convince the UK tax authorities that you can legitimately work as self-employed or through your own limited company. If you can’t convince them of this, then you’ll need to work through an umbrella company, which will significantly increase your costs and so reduce your take home pay.
In conclusion
For a first job in the UK we recommend doctors to go for salaried employment. Once you’ve got some UK experience under your belt and references to go with it, then the choice is much more open.
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