When you work through a recruitment agency, you will be asked to opt-in or out of the Conduct Regulations. But do you know what this means? Continue reading as we explain what the Conduct Regulations are and what it means to opt-in or out of the legislation.
What are the Conduct Regulations?
The Conduct of Employment Agencies and Employment Business Regulations 2003, more commonly referred to as the Conduct Regulations, provide a framework of minimum standards that ensures recruitment companies treat their candidates and clients fairly.
The Conduct Regulations cover:
- Information required from/given to the client and provided by/to the contractor;
- The contractual documentation which must be in place;
- When a contractor must be paid;
- When transfer fees can be charged to the client.
Non-compliance with the legislation can be reported to the Employment Agency Standards Inspectorate (EAS), who will investigate the claim. If a company is not abiding by the regulations, it can lead to a consideration of prosecution proceedings, or a consideration of prohibition proceedings.
More information about the Conduct Regulations can be found on APSCo’s website.
What protections do the regulations provide contractors?
The Conduct Regulations can protect agency workers during an assignment and will ensure that:
- You are paid by the agency for the work you have completed, even if the client does not pay them;
- The agency will not restrict you from providing services directly to the client once the contract has terminated;
- The agency will not withhold payment from you in certain circumstances or for an unreasonable amount of time;
- You will be given a set of terms detailing essential aspects of the assignment, such as the contract length and rate of pay;
- You will not be charged for the agencies work-finding services.
How do I opt-out of the Conduct Regulations?
It is important to note that it is entirely your decision whether you want to opt-out of the regulations, and your agency will provide you with an EAA form that will ask you to state your decision. However, contractors deemed outside IR35 are advised to opt-out of the regulations to support their status. The EAA form must be signed and returned to your agency before you are introduced to the client; otherwise, the opt-out could be invalid, and the agency will be in breach of the regulations.
What happens if I opt-out?
There are very few benefits of opting out of the regulations if you are operating inside IR35. If you decide you want to opt-out, you will lose the protection of payment if the client does not pay your agency for the work you have completed. The agency can also use restrictive covenants, preventing you from contacting or working for a competing agency or a client’s competitor. There are also other regulations relating to temporary-to-permanent fees, which can negatively impact the client if they decide to take on the contractor as an employee or direct contractor. Finally, before being introduced to a potential client, you must agree on terms with the agency, significantly reducing contractor flexibility in their assignment or career.
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