Changes to Conduct Regulations & Agency Standards Enforcement

It is worth the reminder that there were two related BERR consultations in 2007 on "... measures to protect vulnerable agency workers" and "...National Minimum Wage and Employment Agency Standards Enforcement". Following responses to the consultations, the proposed legislation was finalised and will take effect in two stages during 2008.

The Conduct of Employment Agencies and Employment Businesses (Amendment) Regulations 2007.

These regulations amend the Conduct of Employment Agencies and Employment Businesses Regulations 2003 ("Conduct Regulations") and introduce new provisions that are intended to better protect agency workers with effect from 6th April this year. Key changes are:

• Regulation 5: Where a worker decides to take up services from an agency, for example, accommodation or transport, the worker will be given a right of withdrawal from all services subject to five working days notice, or ten working days for accommodation.

• Regulation 21: Amendments to procedures when passing information between the client and worker in cases where the assignment is for a short term (less than five working days) and information has already been provided.

• Regulation 32: The rules relating to obtaining a valid limited company "opt-out" from the Conduct Regulations will now include the obligation for notice of the opt out to be given to the client before any supply starts. It has always been the case that to be valid an opt out must be given by the contractor and company before supply starts. This latest rule places an additional burden on the recruiter. If there is no valid opt out certain clauses in your contract relating to transfer fees may be invalid (depending on the terms used), and recruiters should comply with all the relevant Conduct Regulations.

For more advice on the new regulations or the processes required to comply with the 2003 Conduct Regulations please call Ravi Murphy on 01273 236236.

Employment Bill 2008.

This Bill will introduce new provisions relating to enforcement from 1st October this year, specifically:

• Strengthened investigative powers for Employment Agency Standards Inspectorate in enforcing the Employment Agencies Act and related Regulations, including powers to allow EAS inspectors to demand and secure copies of financial information from an agency or suspect directly or from their bank or building society.

• Increased penalties applicable for breaches, and new modes of trial.

Many in the industry support the simplifications introduced in the Regulations amendments, and the improved enforcement powers in the Employment Bill should help to tackle those seriously non-compliant recruitment businesses that are known to be contravening prohibition orders. There remain parts of the Regulations that are almost unworkable in practice for some parts of the recruitment process, and there is concern that these widespread unintentional compliance breaches are only being selectively enforced rather than addressed at a general level. It remains to be seen whether these powers will be used appropriately and whether there will now genuinely be a level playing field with all recruitment businesses expected to satisfy a minimum compliance standard.