REC confirms that it will continue to enforce higher standards despite changes to statutory requirements
Last October saw amendments to the Conduct of Employment Agencies and Employment Businesses Regulations. The changes resulted in agencies that place permanent candidates being relieved of some of their statutory obligations in terms of obtaining a client's and candidate’s agreement to terms.
However, the REC has confirmed that it will continue to ensure that agencies do obtain agreement as part of the good practice enshrined in the industry Code of Professional Practice.
All REC members must sign up to the Code which includes specific provisions on transparency and clear communication. The decision to continue driving best practice in this area despite the legislative change was confirmed by the REC’s Professional Standards Committee, which is made up from recruitment industry peers as well as representatives from the CBI and TUC.
Commenting on the amendments, Lorraine Laryea, REC Solicitor and Commercial Advisor said:
“Our Code of Professional Practice stresses that members must be transparent in their dealings with both clients and candidates. It requires agencies to ensure that ‘all fees, charges and services provided are explicitly and fully disclosed to clients prior to the acceptance of an assignment, or prior to any work being undertaken for a client.
“From a contractual point of view, it remains crucial that agencies can show they have entered into a contract with their clients and that there is no confusion over the terms. Although the statutory obligations have been reduced, the REC will continue to require members to comply with best practice standards on this specific issue.”
Commenting on the implications of the changes, Clare Flower, the REC’s Compliance Policy Advisor said:
“Statutory obligations may have changed but clients and candidates will still expect clarity and transparency when dealing with agencies. Compliance with the Code of Professional Practice means going beyond minimum requirements and provides a crucial differentiator for our members. The commitment to best practice is a core message within our ongoing client-awareness campaign, it remains imperative that employers and candidates have absolute confidence that REC members will conduct their businesses to the highest standards.”
For clarity, this will mean that when dealing with candidates REC members will be expected to agree as a minimum that it acts as an agency or that it will seek to find permanent work, authorisation to seek that work and the type of work that it will seek.
When dealing with clients, REC members will be expected to agree as a minimum the type of service they will provide (e.g. recruitment services, permanent placements etc), fees (how much the client will pay for the service/how the fees will be calculated) and the specific terms covering how any a rebate/refund would be calculated. For suitability checks, agencies should make it clear to the client what checks will/won’t be carried out as part of the service provided.
Where the agency is not carrying out these checks, it should advise the client that this is the case to enable the client to carry out the checks. In this way the agency is being clear about what service/level of service it is providing while giving the client the opportunity to determine and choose what type of agency it wants to use.
The REC will check members’ compliance with the above obligations through inspections/audits, the complaints function and new member entry requirements.
Further analysis of what the amendments to the Conduct Regulations mean in practice will be included in the next REC Legal bulletin.
In summary, some of the key changes that came into force last October include:
• The removal of the requirement to obtain a candidate’s agreement to terms stating the type of work they are looking for and the fact they are looking for permanent work;
• The removal of the requirement to obtain a client’s agreement to terms of business.
• The removal of the requirement for terms to be recorded in a “single” document.
• Agencies retain an obligation to check a candidate’s identity, obtain copies of qualifications and two references but only for those candidates working with vulnerable persons. There is no longer a statutory requirement to carry out these checks for other roles.
• Advertisements need no longer indicate if you are an “employment agency” but must state if the work is “temporary or permanent” work.