Gangmasters licensing
What is Gangmaster’s licencing?
Operated by the Gangmasters & Labour Abuse Authority (GLAA) and governed mainly by the Gangmasters (Licensing) Act 2004 (GLA Act), a Gangmasters licence is a licence required before someone can supply/introduce a worker to another person - typically for labouring. The person upplying/introducing a worker to another person i.e. a client, is known as a Gangmaster. The licence is required to ensure that Gangmasters are complying with its legal obligations under employment law. The GLAA are also responsible for ensuring that a Gangmasters legal obligations are being met, and that workers are protected from exploitation.
In what instances will I require a licence?
If you are operating as an employment agency or business and you are supplying labour into sectors which are regulated by the GLAA then you must hold a licence from the GLAA before you supply any labour into that sector. This applies whether your client is based in the UK or outside the UK and it includes:
- Introducing workers to a labour provider or labour user;
- Sourcing workers and supplying/introducing them to a UK client for work, for example sending CV’s or application forms; and/or
- Screening candidates, even if it is the client that makes the final decision to employ the worker.
GLAA regulated sectors are are:
- Agricultural work including dairy farming;
- Horticulture;
- Shellfish gathering;
- Packaging or processing all fresh food, drinks and other produce.
There are however exemptions and the GLAA provides detailed guidance of the types of labour in these sectors which are exempt from licencing.
These exemptions are set out in The Gangmasters Licensing (Exclusions) Regulations 2013 (England, Scotland and Wales) and The Gangmasters Licensing (Exclusions) Regulations (Northern Ireland) 2014.
It is recommended that you check with the GLAA before assuming that these exclusions apply. For further information, please read the GLAA guidance on who needs a licence.
How can I get a GLAA licence?
In order to hold a GLAA licence you must meet all of the conditions of the GLAA licensing Standards. These cover the requirements set out in the Gangmasters (Licensing Conditions) Rules 2009 and other relevant legal requirements that you must comply with.
You can apply for a licence online or by telephone (0345 602 5020). Applications are typically processed in six to eight weeks once payments have been cleared.
The GLAA licensing team use information gathered from inspections, other government departments and enforcement agencies to consider new applications and existing licences and make decisions regarding whether or not to grant a licence, whether to revoke a licence, and whether to place additional conditions on a licence.
How much will a GLAA licence cost me?
When applying for a GLAA licence, you must pay an application fee and an inspection fee. These costs are non-refundable regardless of whether your licence is granted or refused. When it is time to renew your licence you will also have to pay an annual renewal fee but there is no charge for an inspection. Licence fees are calculated according to the annual turnover of your business in the licensed sectors only. Please click here to see the different fee bands and associated costs.
Please note: that if you over declare your business turnover in your application you will not receive a refund at a later date, and if you under declare your turnover you risk your application being refused or your licence being revoked.
What can I do if my application is refused?
If an application is refused, there is a pre-appeal process where the business has the opportunity to correct any factual errors that they believe he GLAA has made when making its decision. This must be done with 10 days of the decision being made. There is still a right to appeal if the pre-appeal is refused.
How long does a GLAA licence last?
A GLAA licence currently lasts for one year from the date of issue with the GLAA sending a renewal reminder to the licence holder six weeks prior to the expiry date. A GLAA licence will automatically expire if:
What does it mean if my GLAA licence is revoked?
Licences may be revoked with or without immediate effect. A revocation with immediate effect means the business must stop acting as a Gangmaster immediately. A revocation without immediate effect means that the business can continue to operate as a Gangmaster pending the outcome of any appeal.
What is a GLAA licensing inspection?
The GLAA conducts application inspections to ensure that applicants meet the necessary requirements to hold a licence. Currently inspections are discretionary based for applicants. A further inspection may also be conducted after a licence has been granted, if an organisation is suspected of operating without a licence or if there are allegations of worker exploitation. During an inspection, an applicant or licence holder may be asked to give details of any current contracts with clients. The inspection may include visiting clients’ premises to check the place of work, interviewing workers and requesting for documentation in order to check compliance.
Failure to meet the required licensing standards will attract a number of points. If an organisation accumulates 30 points or more it will not be granted a licence or may find its licence revoked (with or without immediate effect). Some licensing standards are marked “critical” and must be met in order to obtain or retain a licence. There are three possible outcomes after an inspection:
How will the licencing rules apply if I am supplying workers engaged via an umbrella?
If you supply workers engaged via an umbrella who is acting as a labour provider i.e. has put a worker on a contract of employment, then both you and the Umbrella Company will need a GLAA licence before you can supply workers into the GLAA regulated sector.
If however you are simply outsourcing your own payroll via an umbrella company and no such contract of employment exists between your workers and the umbrella company, then the umbrella company will not require a licence.
What are the repercussions if I provide labour into the GLAA regulated sector without a licence?
It is a criminal offence under the Gangmasters (Licensing) Act 2004 to provide labour into the sector before you are granted a GLAA licence.
For any labour providers who are unlicensed and supply workers to the GLAA sector without holiding a GLAA licence; or hold documentation to suggest that unlicensed gangmaster holds a GLAA licence, the ramifications are up to a maximum of 10 years imprisonment and/or a fine.
For any client business operating within the sectors covered by the Act to use labour supplied by an unlicensed labour provider, the maximum penalty is 51 weeks in prison and/or a fine. In Scotland and Northern Ireland, the penalty is 6 months in prison and/or a fine.
If a party were to intentionally obstruct GLAA officers in the course of their duties, fail to comply with their requirements or give false information, the maximum penalty is also up to 51 weeks imprisonment and/or a fine.
Disclaimer
This information is for guidance purposes only and should not be regarded as a substitute for taking legal advice. Please refer to the full terms and conditions on our website.