A stark reminder was handed down recently by the courts – comply with the legislation or face the consequences!
The director of Whites Recruitment International pleaded guilty to eight charges contrary to the Conduct of Employment Agencies and Employment Businesses Regulations 2003 (Conduct Regulations) for failing to supply workers with the necessary paperwork and for withholding wages. He was fined £16,000 and ordered to pay £16,979.38 towards prosecution costs.
This case serves as a warning of the serious consequences that directors and agencies can face if they fail to comply with the Regulations.
Agencies that break the law may be prosecuted and subject to unlimited fines. ‘Rogue agencies’ could also be banned from operating for up to 10 years. In the Whites case, the individual concerned was banned from acting as a company director for 2 years.
Theresa Mimnagh, Associate Director at Lawspeed, commented “The Conduct Regulations have been around since 2004, yet they are not always considered a significant compliance priority for recruiters, with concerns over the AWR, tax liability and commercial considerations often taking precedence. However, this case shows clearly that not only do Employment Agency Standards have the power to enforce the regulations, but that they will take enforcement action where required”.
Mimnagh continued “This case was relatively extreme. However, the risk of liability under the Conduct Regulations can be mitigated by having compliant contracts, good internal processes and staff training, for example to ensure that valid opt outs are in place, and that payment arrangements with clients do not expose you to risk of a breach.”
Lawspeed provides a hotline for recruiters on all compliance issues. Give us a call on 01273 236 236 or email us at info@Lawspeed.com