News and Updates

Recruitment Industry Update

2015 was a relatively active year for legal developments the recruitment industry.  Points of interest are set out below:
 
Ban on advertising vacancies exclusively in other EEA countries
The government is concerned that that employment agencies and employment businesses advertise vacancies for jobs based in Great Britain in other EEA countries, without giving workers in Great Britain the opportunity to apply. 
 
With effect from 5 January 2015, regulation 27A of the Conduct of Employment Agencies and Employment Businesses Regulations 2003, prohibits an employment agency or an employment business from advertising a "GB vacancy" in an EEA state other than the United Kingdom, unless one of the following conditions applies:
  • It advertises the vacancy in English in Great Britain at the same time as it advertises the vacancy in the other EEA state.
  • It has advertised the vacancy in English in Great Britain in the period of 28 days ending with the day on which it advertises the vacancy in the other EEA state.
A "GB vacancy" is defined as "a vacant position the duties of which are ordinarily to be performed in Great Britain".
Breach of the restriction is a criminal offence.  The restriction will not apply if the GB vacancy relates to a position within the employment agency or employment business.
 
The government launched a further consultation on 13 October 2015 regarding amendments to the Conduct Regulations generally, in which it sought views on whether to extend the restriction on overseas recruitment of work-seekers, by banning employment agencies and employment businesses from recruiting work-seekers from overseas EEA countries without advertising the relevant vacancies to domestic work-seekers. If implemented, this change would compel recruitment agencies to advertise in Great Britain each time they engage in recruitment activity overseas, with a view to filling the vacancies from work-seekers in Great Britain. They would no longer be permitted to fill such vacancies using work-seekers already on their books. 
For further information, click here.  
 
Hiring agency staff during industrial action: consultation
The Conduct of Employment Agencies and Employment Businesses Regulations 2003 prevents an employment business from supplying the employer with temporary workers to perform the duties normally performed by a striking worker, or the duties normally performed by any other worker who has been assigned to cover the striking worker.
 
On 15 July 2015, the government published a consultation, seeking views on the removal of this provision. The consultation closed on 9 September 2015 and the responses are being analysed. The government's stated aim is to reduce the impact of strike action on the wider economy and society, by ensuring that businesses can continue to operate to some extent during a strike. Further information is available here.  
 
IR35 reform
On 17 July 2015, HMRC published a discussion document seeking suggestions on ways to improve the efficiency of the IR35 legislation in reducing the tax and NIC advantage for individuals engaged through a personal services company (PSC) instead of as direct hire employees.  Options include administrative changes, increased involvement by engagers in ensuring the correct amount of tax is paid and/or a limitation in the scope of what falls within IR35 to engagements above a certain duration, with a possible adoption of the deemed employment criteria set out in the intermediaries legislation.  Further information is available here.  
 
Agency Workers Regulations 2010: Coles v Ministry of Defence UKEAT/0403/14
In July 2015 the Employment Appeal Tribunal considered the scope of Regulation 13(1) of the Agency Workers Regulations 2010 which provides that:
"An agency worker has during an assignment the right to be informed by the hirer of any relevant vacant posts with the hirer, to give that agency worker the same opportunity as a comparable worker to find permanent employment with the hirer."
 
Mr Coles argued that the legislation gave him the right, not just to be informed about vacancies, but to be considered for any such vacancies on an equal footing with permanent employees.  The EAT disagreed.  The AWRs give agency workers equivalent rights to comparable employees, as regards working hours and pay, but do not give parity of status with permanent employees in general terms.  Regulation 13(1) clearly provides a right to information only.
 
Conduct Regulations reform
The government launched a consultation on 13 October 2015 regarding making amendments to the Conduct of Employment Agencies and Employment Businesses Regulations 2003, to remove requirements which are deemed to be too burdensome.
Draft regulations, the Conduct of Employment Agencies and Employment Businesses (Amendment) Regulations 2016, are included with the consultation document which can be found here.
A response to the consultation is expected in February 2016.
 
National price caps for agency staff working in the NHS
On 15 October 2015, the government published a consultation on proposed rules for price caps for agency staff and bank staff procured by NHS providers.  The consultation closed on 15 November 2015 and very speedily thereafter, Monitor and the NHS Trust Development Authority introduced caps on the hourly rates paid for all agency staff which took effect from midday on 23 November 2015.  Further information is available here.  
 
For further information on the issues raised in this article, please contact us on 020 7925 8080 or by email at info@spencer-wyatt.com.
 

 

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