A brave new world – threats, challenges and opportunities in 2013

Adrian Marlowe, chairman of ARC, delivered a fascinating presentation at the Recruitment Agency Expo in London earlier this week.

Challenges in 2013 – a brave new world? examined how 2013 could be the year that pitches big business against the ‘little guy’ and how government proposals for self-regulation of the industry could herald a defining moment in the industry.

Alien Invasion

“Pay when paid” clauses used by Recruitment Process Outsourcing companies (RPOs) can be restrictive and onerous for the second tier agencies which supply workers through them.

Like the North American crayfish and mink, species which can harm our native wildlife, the increasing number of RPOs (a business model imported from the USA) is having negative consequences for UK recruiters because of the structure of current regulations.

ARC is currently campaigning to introduce rules to force RPOs to scrap “pay when paid” clauses and reduce the payment periods offered as well as rule out restrictions on assignment of debt so that recruitment businesses can operate on a level playing field.

VAT attack

Marlowe went on to explain how he is optimistic about the three year fight ARC has undertaken to restore ‘VAT on margin only’ businesses. This could be achieved through the current consultation into Agency Conduct regulations. When successful, this move will make agency workers more attractive to hirers such as charities and local authorities, who are not VAT registered.

A defining moment

Marlowe closed the afternoon by asking the audience a couple of questions; did they see any advantages to deregulation? Could the scrapping of the majority of Conduct Regulations pose a danger to the reputation and professionalism of the recruitment business?

Responses included “This will just take us backwards”, “it’s a retrograde step”, “why is the government doing this?” and “if it ain’t broke don’t fix it”. The audience was at a loss to understand the reasoning behind the proposal. “The burden will just be shifted” commented another attendee, and “no one wants trade bodies to effectively take over responsibility for standards, there are too many conflicts”.

Marlowe and ARC are in agreement that the government’s proposal causes speculation about who would benefit from the changes and how great the impact on the industry could be. A step in the dark may not lead to a brave new world.

To download a copy of the Challenges in 2013 – a brave new world? presentation click <here> http://www.arc-org.net/events/recruitment-agency-expo.aspx

To find out more about how ARC can support and benefit your business call 01273 777 997 or email; info@arc-org.net