The key information document (regulation 13A)
- Summary
- Introduction to the Conduct Regulations 2003
- Registration process - temporary workers
- Registration process - permanent introductions
- The key information document (regulation 13A)
- Agreeing terms with your client and the work-seeker
- Obligations towards your client
- Obtaining assignment details from hirers and information about workers
- Paying work-seekers
- Charging work-seekers
- What is the Conduct Regulations opt-out?
- Charging clients
- Identity checks (checking who the work-seeker is)
- Unsuitable workers
- Strikes and industrial disputes
What is the Key Information Document?
From April 2020 it will be a requirement for employment businesses to provide any temporary work-seekers they supply, either on a contract for services or via a limited company, with a Key Information Document (K.I.D.). The purpose of this document is to clearly and succinctly set out the essential information a work-seeker requires prior to starting an assignment. The idea of this document is to promote greater transparency and accountability in the relationship between an employment business and a work seeker. The requirement to have a K.I.D. was developed as a response to increasing concern by the government regarding arrangements where a worker is supplied through an intermediary such as an umbrella company. As it currently stands, there is a lack of clarity surrounding who the employer is of a worker who is engaged via an intermediary for the purposes of paying the worker and ensuring the correct deductions are made from that pay.
One area of confusion here is the concept of the “work-seeker” for the purposes of to whom the K.I.D. should be provided. In context, the term work-seeker can be used to refer to both an individual work-seeker, or to an umbrella or limited company that then engages an individual to do the work. The intent of the K.I.D. is to benefit the individual work-seeker, or if the work-seeker is a company, the individual who is being supplied by that company to do the work. It is a statutory obligation for employment businesses to provide the K.I.D. and to ensure that the individual performing the role receives it. This means it is increasingly important for employment business to carry out appropriate due diligence checks on other parties within the supply change to ensure the K.I.D. is provided to all the required recipients.
The requirement to provide a K.I.D. is set out in The Conduct of Employment Agencies and Employment Businesses (Amendment) Regulations 2019, which will amend the Conduct of Employment Agencies and Employment Businesses Regulations 2003 to contain an additional regulation, 13A, which covers the K.I.D. and what it needs to contain. These regulations are coming in to force from 6 April 2020 and it will be a requirement for employment businesses to provide a K.I.D. to all work seekers.
More information can be found in the Government’s ‘Providing a ‘Key Information Document’ For Agency Workers’ guidance.
What information needs to be in the Key Information Document?
The Conduct of Employment Agencies and Employment Businesses (Amendment) Regulations 2019 are very clear on what a K.I.D. needs to include. Where the K.I.D. is being given to an individual work-seeker it must include:
- the title “Key Information Document” at the top of the first page
- a statement directly below the title that sets out the purpose of the document and the relationship between the employment business and the work-seeker
- details of other relevant documents where necessary
- the contact details of the Employment Agencies Standards Inspectorate (EASI)
- the type of contract the work-seeker will be engaged on
- the identity of the employment business and, if different, the identity of whoever is responsible for paying the work-seeker
- the rate of pay, or minimum rate of pay, that the work-seeker can expect to receive
- the interval at which the work-seeker will be paid
- the amount and nature of any costs or deductions that will be made from the pay
- the amount and nature of any fees for goods and services for which the work-seeker must pay a fee
- any non-monetary benefits to which the work-seeker is entitled
- annual leave and holiday pay entitlement
- a representative example statement that sets out the reasonable remuneration a work-seeker can expect to receive for a single pay period
Where the work-seeker is an umbrella or limited company, and the K.I.D. is being given to the individual supplied by the work-seeker, then it must include:
- the title “Key Information Document” at the top of the first page
- a statement directly below the title that sets out the purpose of the document and the relationship between the employment business, the work-seeker, and any individual being supplied by the work-seeker
- details of other relevant documents where necessary
- the contact details of the Employment Agencies Standards Inspectorate (EASI)
- the identity of the work-seeker
- the type of contract that the individual being supplied by the work-seeker will be engaged on
- the identity of the employer of the individual who is being supplied and, if different, the identity of whoever is responsible for paying the work-seeker
- the nature of any connections between any of the parties, where any of the employment business, the work-seeker, the employer of the individual carrying out the work, or the individual carrying out the work are connected
- the rate of remuneration payable to the work-seeker, or the minimum rate of remuneration that the employment business expects them to receive
- the rate of remuneration payable to the individual supplied to do the work, or the minimum rate of remuneration that the employment business expects them to receive
- the intervals at which remuneration will be paid to the work-seeker and the individual supplied by the work-seeker
- the amount and nature of any costs or deductions that will be made from the pay
- the amount and nature of any fees for goods and services for which the individual supplied by the work-seeker must pay a fee
- an explanation of the difference in the rate of remuneration received paid to or expected to be paid to the work-seeker and the rate paid to or expected to be paid to the individual supplied by the work-seeker to carry out the work
- any non-monetary benefits to which the individual supplied by the work-seeker is entitled
- annual leave and holiday pay entitlement for the individual supplied by the work-seeker
- a representative example statement that sets out the reasonable remuneration an individual supplied by the work-seeker can expect to receive for a single pay period
- all the information must be presented on no more than two sides of A4 paper (dimensions of 210 by 297 millimetres)
- the information must be provided in clear succinct language and must be separate from any other documents
- the document must not contain any additional information beyond what is required in regulation 13A, or any of the information required under regulations 14 and 15 of the Conduct Regulations 2003.
When does the Key Information Document need to be given to the work-seeker or individual being supplied by the work-seeker?
Regulation 13A of the Conduct of Employment Agencies and Employment Businesses (Amendment) Regulations 2019 states that the K.I.D. must be given to the work-seeker, or to the individual being supplied by the work-seeker “before obtaining the agreement to the terms which will apply as between the employment business and the work-seeker in accordance with regulation 14”. Regulation 14 is part of the Conduct of Employment Agencies and Employment Businesses Regulations 2003 and covers the agreement of terms with work-seekers before you provide work-finding services to them. In practice this means that the K.I.D should be one of the first documents you provide to a candidate. Other than this requirement, there is no specification as to exactly when the K.I.D. must be provided.
Is it possible to opt out of Regulation 13A?
Whilst an individual working via an intermediary is able to opt out of the Conduct of Employment Agencies and Employment Businesses Regulations 2003 (Conduct Regulations), it is not possible to opt out of the requirements under regulation 13A in any circumstances. This means that even where an individual has opted out of the Conduct Regulations the requirement to provide them with a K.I.D. will still be applicable, and the K.I.D. should be provided to them in line with the content of regulation 13A.
What action can I take now to prepare for the introduction of the Key Information Document?
The obligation to provide a K.I.D does not come into force until 6 April 2020, however, where you are engaging with an umbrella company to supply workers it may be beneficial to discuss this with them ahead of this date. As the K.I.D. requires certain information to be on it that you may not know as an employment business you will need to obtain this information from the umbrella company. This means you will need to make sure that the umbrella company has systems in place to gather the necessary information in good time for this to be provided to the individual being supplied to do the work in line with the requirements set out in regulation 13A.
Do I need to give a candidate multiple Key Information Documents?
Where you have multiple options for how you will be paying a temporary worker then the expectation is that you would provide a K.I.D corresponding to each different payment method to the worker. This means that you may need to have a K.I.D for standard PAYE contract for services arrangements as well as a different K.I.D. for each umbrella company that the worker may be able to work through. By providing the different documents this allows for greater transparency in the recruitment process and allows the worker to make an informed decision about what method of supply they want to work through. However, there is no statutory requirement under the regulation to provide different documents, so long as the worker does receive a K.I.D. that is reflective of the payment method they are going to be contracted through.
A candidate we are going to register is already signed up to an umbrella company that they intend to work through, do we still need to issue them a Key Information Document?
The purpose of the K.I.D is to ensure that candidates are able to make an informed decision of how they choose to work. The K.I.D is designed to promote transparency to workers regarding the information they are provided, particularly around pay. This means that even where a worker is already signed up to an umbrella company it is recommended that you provide them with a K.I.D for this arrangement, and also a standard PAYE arrangement so that the worker can make a comparison between the options available to them before signing terms. However, there is no statutory obligation to provide a worker with more than one K.I.D. provided they worker receives at least the K.I.D. that corresponds to the way they are actually engaged.
What is required for workers who provide their services via a PSC?
Like PAYE workers and those working through an umbrella company, workers that wish to engage with an employment business through their own PSC must be provided with a key information document before agreeing terms.
The requirements for PSCs differ to umbrella companies and other intermediary arrangements because the PSC is defined as the work seeker and is controlled by the person to be supplied.
This means that only one Key Information document must be issued unlike with umbrella company arrangements where both the umbrella company and the individual carrying out the work must receive a Key Information document. Employment businesses will usually have to obtain some of the relevant information from the PSC in order to complete the key information document. Any deductions made between the employment business and the PSC will need to be shown so that the work seeker has a full idea of what they expect to receive in their pay.
Is there a template Key Information Document I can use?
The REC has published K.I.D. templates that are available for members to download. There are 3 different templates: one for workers engaged on a standard PAYE basis, one for where the worker is engaged via an umbrella company, and one for where the worker is engaged via their own PSC. All 3 of these templates can be found in the Forms & Letters section of the REC template document library.
The Government has also published a number of K.I.D. templates that can be used by employment business to provide to their candidates. It should be noted that the Government’s templates do contain a space for the individual candidate’s name to be included. This is not a requirement as per the wording of Regulation 13A but may be beneficial to help demonstrate that the document has been given to an individual. Employment businesses would be able to remove this section if they wish to do so but they must ensure that they can show and evidence that the K.I.D. is given to each individual.
Employment businesses can also design their own K.I.D. if they want to, so long as it complies with the content and format requirements set out in the regulations.
Disclaimer
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