Contractors' Questions: Why are the Agency Conduct rules being rethought?

Contractor’s Question. Why are the Agency Conduct regulations, among other rules governing the recruitment sector, being consulted on and what does industry hope the final outcome will be?

Expert’s Answer: The same issues that were thrown up in reviews of aspects of these regulations since 2004 appear to be back on the agenda. The added twist is that it may actually be a good thing for the recruitment industry to self-regulate and for workers to be able to pursue claims through the Employment Tribunal rather than the Employment Agency Standards Inspectorate (EAS).

Standards have risen since 2003 and the EAS has worked well so I do not understand the driver for such sweeping changes. I don’t think it will save the government money in the long term and The Red Tape Challenge was set up to look at unnecessary regulation hindering business – I don’t believe these to be either unnecessary or a hindrance to our industry.  Some adjustments and improvements could certainly be made but to tear up the copy book and to start all over again seems like a strange suggestion.

Also, I think a second consultation due in late summer will mean more time, effort and continuing uncertainty for those involved in the recruitment sector.  I wish that I could at least explain to our clients the reason that they may once again have to change direction, incur more cost, waste time, reduce profitability, at a time when the economy is down and most are already hard pressed.  All they want to do is get on with their work and help businesses grow. Until then, I agree with our clients, the best lesson to be learned from history is  - ‘if it ain’t broke don’t fix it.’

That said, consolidating all the rules into one place and removing the few genuinely unnecessary ones, which do not relate to professional standards, would be useful. Perhaps tidying up some of the language and carving out the entertainment sector provisions would assist.

Despite claims to the contrary, there is little case for including umbrella companies within the scope as they do not provide work-finding services. Nevertheless, inclusion of new rules restricting RPO ‘pay when paid’ clauses and other related practices which do damage the industry would be a very positive step.

The expert was Adrian Marlowe, managing director of recruitment law firm Lawspeed.

Tuesday 26th March 2013