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If you are operating as an employment business you must agree written terms and conditions with work-seekers and hirers before you undertake any work-finding services. For more information see employment businesses - content of terms with work-seekers and employment businesses - content of terms with hiring companies.

Additional services

If you provide any additional services, such as CV writing, accommodation, transport etc, this should be covered in a separate document and issued to work-seekers before providing these services - see employment agencies - providing additional services and goods.

Additional rules apply to employment agencies and businesses operating in the entertainment or modelling sectors - see entertainment and modelling agencies.

Advertisements

You must not advertise a vacancy unless you have obtained full details of the specific position advertised and the authority of the hirer to find work-seekers for that position or the authority of an agency or employment business which has the authority to issue the advertisement.

Every advertisement must include the full name of the agency or the employment business and confirmation of whether the vacancy is 'temporary' or 'permanent'.

Where the rate of pay is included in the advertisement it must also include the nature of the work, the location, the minimum experience levels and details of any training required.

More than one employment agency or employment business involved

If you agree with another employment agency or employment business to facilitate the provision of work-finding services to a work-seeker or hirer, you must make enquiries to establish that the other agency/business is suitable to act as such and there must be satisfactory answers to those enquiries.

You must also agree in which capacity each of you will act - ie as an employment agency or an employment business. For details about records of enquiries see employment agencies and employment businesses: record keeping responsibilities.

If you supply work-seekers who provide their services through a limited company such work-seekers are covered by these rules (unless they have given notice to opt out - see below). Any references to a work-seeker in this guide also includes a work-seeker that is a limited company and, in most cases, the person who is or would be supplied by the 'work-seeker' (limited company) to carry out the work.

Limited company contractors and those persons they supply can agree not to be covered by the regulations provided they give notice to 'opt-out' of the regulations before they are introduced or supplied to a hirer.

Where an incorporated work-seeker has 'opted out' of the regulations, you must inform the hirer that the worker has 'opted out' and the regulations will therefore not apply.

A work-seeker can withdraw the opt-out notice after they have commenced working with a hirer but the withdrawal of the opt-out notice will only be effective when the work-seeker (or the person supplied to do the work) stops working in that position.

The 'opt-out' provision does not apply to those limited company work-seekers who will be supplied to work with vulnerable people.

Entering into contracts with hirers and work-seekers

Employment businesses

Where you operate as an employment business you cannot enter into a contract on behalf of a work-seeker with a hirer or on behalf of a hirer with a work-seeker.

Employment agencies

Where you operate as an employment agency you can only enter into a contract with a work-seeker on behalf of a hirer if the hirer has given you authority to do so. You can only enter into a contract with a hirer on behalf of a work-seeker if the work-seeker is seeking employment in the entertainment sector and the work-seeker has given you authority to enter into such contracts.

Whether you act for the work-seeker or hirer you must inform your client of the terms of the contract within five business days of entering into that contract.

When agreeing to the terms of a contract you cannot act on behalf of both the work-seeker and the hirer.

Before starting to find work for work-seekers you must agree the terms that will apply with the work-seeker. These should include:

• a statement that the services provided will be those of an employment business
• the type of work you will find or seek to find for the work-seeker
• whether those work-seekers are or will be employed by you under a contract of service, or apprenticeship, or a contract for services, and the terms of employment that will apply
• an undertaking that you will pay the work-seeker for all work done by the work-seeker regardless of whether or not you are paid by the hirer
• the length of notice which the work-seeker will be required to give and entitled to receive from the employment business in respect of particular assignments with hirers
• either the rate of pay payable to the work-seeker, or the minimum rate of pay which you reasonably expect to achieve for the work-seeker
• details of the intervals at which remuneration will be paid (for example, weekly in arrears etc)
• the amount of holiday and details of payment for holiday that will be given - the majority of work-seekers will be covered by  and, therefore, will be entitled to statutory holiday pay

Where the work-seeker is a limited company (and not opted out of the regulations) and where annual leave provisions would not apply, you must detail any period of absence that a limited company work-seeker may be entitled to and to be paid for.

If you and the work-seeker agree any changes to the terms, you must, as soon as reasonably practicable after the changes have been agreed, give the work-seeker a new document setting out details of the changes and stating the date that the varied terms take effect.

Before providing a service to a hirer you must agree with the hirer the terms and conditions which apply or will apply between you and the hirer.

You should give them a statement that the services provided will be those of an employment business (ie supplying temporary workers).

Details of fees

You should also set out the details of any fees which may be payable to the agency or employment business by the hirer including:

• the amount of the fee or its method of calculation
• the circumstances, if any, in which refunds or rebates are payable to the hirer or, if none are payable, a statement to that effect

Procedure for unsatisfactory worker performance

Finally you should set out the procedure to be followed if you supply a work-seeker to a hirer who proves unsatisfactory. For example:

• how the hirer should notify you if a temporary worker supplied is not satisfactory - including the time limits for doing this
• what you will do as a consequence eg terminate the worker's assignment, seek to rectify the problem or supply an alternative work-seeker

You must ensure that all of the terms between you and the hirer are recorded and that a copy is provided to the hirer as soon as is practical. This will normally take the form of a set of business terms or a letter setting out all the terms agreed.

If you and the hirer agree any changes to the terms, you must, as soon as reasonably practical after the changes have been agreed, give the hirer a new document setting out details of the changes and stating the date that the varied terms take effect.

As an employment agency or business, before placing a work-seeker with a hirer you must obtain sufficient information from the hirer about that position including:

• the identity of the hirer and, if applicable, the nature of the hirer's business
• the date on which the hirer requires a work-seeker to start work and the duration of the work
• the position the hirer is seeking to fill, including the type of work, location, working hours and any health and safety risks and controls
• the experience, training and qualifications which the hirer requires for the post or are necessary by law
• any expenses payable by or to the work-seeker
• (in the case of an agency) the minimum rate of remuneration, benefits, method of payment, and, where applicable, notice periods for termination of employment

If you operate as an employment business or you operate as an employment agency which is introducing workers where the worker will be working with vulnerable people you must:

• ensure a work-seeker has the experience, training, qualifications and any authorisation required by the hirer by law or by any professional body
• seek confirmation of the work-seeker's identity

For further information see employment agencies and employment businesses: record keeping.

As an employment business, if you supply or introduce a work-seeker where professional qualifications are required you should obtain copies of any relevant qualifications and make them available to the hirer.

As an employment agency or employment business if you supply or introduce a work-seeker who is required to work with or care for vulnerable people you must obtain two references on the work-seeker and make them available to the hirer, as well as carrying out checks to make sure the work-seeker is suitable to work in the position.

Where you have tried to obtain copies of the relevant qualification or references but have been unable to do so you must inform the hirer that you have made reasonable attempts to obtain this information and explain what steps you have taken.

As an employment agency or employment business you must not introduce or supply a work-seeker to a hirer unless you have taken reasonable steps to ensure that the work-seeker and the hirer are each aware of any requirements imposed by law, or by any professional body, in order for the work-seeker to take up the position.

You must also make enquiries to ensure that it would not be detrimental to the interests of the work-seeker or the hirer for the work-seeker to work for the hirer.

Where you operate as an employment business and you receive information that indicates that a work-seeker may be unsuitable for the position you must:

• inform the hirer of that information
• make further enquiries as to the suitability of the work-seeker and inform the hirer of these enquiries

Where the enquiries indicate that a work-seeker is unsuitable for the position, or information is received that indicates the work-seeker is not suitable, you must, without delay:

• inform the hirer of that information
• end the supply of that work-seeker to the hirer

Where you operate as an employment agency, and have introduced a work-seeker to a hirer, and you subsequently receive information within a period of three months from the date of introduction, which indicates that the work-seeker is or may be unsuitable for the position with the hirer you must inform the hirer of that information without delay.

You must not arrange work for a work-seeker (except in situations where they are given a contract of employment by the hirer) if in order to take up that work the work-seeker must live away from home, unless you have taken all reasonable steps to ensure that:

• suitable accommodation will be available before the work-seeker starts work
• the work-seeker has been informed of details of the accommodation including any cost and the arrangements to travel to such accommodation

Where the work-seeker is not the employee of the hirer or the work-seeker is under 18 years of age, and free travel or payment is arranged for the work-seeker's journey to work, you must, if the work does not start or when it finishes either:

• arrange free travel for the return journey
• pay the work-seeker's return fare, or
• obtain an undertaking from the hirer that he/she will arrange free return travel or pay the return fare

You must set out these arrangements in writing for the work-seeker.

Where a hirer does not comply with its undertaking to arrange free return travel or pay the return fare, you must bear this cost for the work-seeker.

You must not introduce or supply a work-seeker who is under the age of 18 for a position if they are required to live away from home, unless you have obtained direct written consent from a parent or guardian.

If you issue a loan to a work-seeker to meet their travel or other expenses to take up a position, you cannot require the work-seeker to repay a sum greater than the sum loaned.

Au pairs

Where the work-seeker is an au pair you must not arrange employment for them if they are required to repay either you or the hirer for the fare between the au pair's home and place of work.

You can require that the au pair pays their own fare from their home to the place of employment but neither you nor the hirer can require that the cost of the fare comes out of the au pair's pay.

You are allowed to charge jobseekers for additional services eg CV writing or transport to jobs. However you are not allowed to charge individuals seeking work for work-finding services unless you are an employment agency in the entertainment sector - see entertainment and modelling agencies.

If you are providing additional services you or anyone connected with your business cannot make the provision of work-finding services conditional on jobseekers using any of these additional services.

Additional services provided by an employment agency

If you provide someone seeking work with more than one service, you must inform them:

• which services are the work-finding services for which you cannot charge them a fee
• which services are the additional services or goods that you can charge for and provide them with details of any such fee, ie the amount or method of calculation of the fee, who the fee will be payable to, a description of what the fee relates to, and the circumstances (if any) in which refunds or rebates are payable to jobseeker

Before providing additional services you must give the jobseeker details of:

• their right to cancel the services at any time, without detriment or penalty
• the amount of notice required if the work-seeker wishes to cancel - ie five working days or ten working days for the provision of living accommodation

If there is a change to the fees for the services offered or the goods provided, you should give the jobseeker further notice detailing the changes.

If you offer any gift or make an offer of any benefit to a jobseeker, for example to entice them to use your services, you must make clear the terms and conditions on which the gift or benefit is offered.

If you operate as an employment agency and introduce a work-seeker to a hirer for employment by the hirer you cannot be responsible for paying the work-seeker remuneration arising from the work-seeker's employment with the hirer.

Separate rules apply to entertainment and modelling agencies. For further information see entertainment and modelling agencies.

If you are an employment business supplying temporary work-seekers you are responsible for paying the work-seekers. You must pay a temporary work-seeker for all the hours they work.

Even if you have not been paid by the hiring company or the work-seeker has not supplied you with a time sheet authorised or signed by the hirer verifying the hours worked by that work-seeker, you must still pay the work-seeker for the hours they have worked.

As an employment business you cannot use transfer fees unreasonably as a means of discouraging or deterring hirers from:

• offering permanent work to temporary workers
• having workers supplied through a different employment business
• introducing workers to a third party to be employed by that party

You can charge transfer fees to hirers to protect your legitimate business interests, in three situations:

1. Temp-to-perm fees - when you have supplied a temporary worker who is then taken on directly by the hiring company.
2. Temp-to-temp fees - if the hiring company changes agency but wants to keep on a temporary worker you supplied, meaning that the worker has to change agency.
3. Temp-to-third-party fees - if the hiring company introduces a temporary worker you supplied to another person that goes on to employ them.

It is unlawful for you to seek to charge a transfer fee (following the supply of a worker) in any other situation. A hirer is entitled to recover any money they have paid for unlawful transfer fees.

Temp-to-perm and temp-to-temp fees

You can charge a transfer fee in temp-to-perm and temp-to-temp situations provided the hirer is given the option to have the worker supplied by you for a specified period of hire, at the end of which the worker will transfer without charge instead of paying the transfer fee.

Where the hirer has opted for a specified period of hire, you must supply the worker for the entirety of that period (unless you are prevented from so doing in circumstances that are not your fault). The supply terms cannot be less favourable to the hirer than those which applied prior to the hirer opting for the specified hire period. In order for a transfer fee to be payable, the transfer of the work-seeker must take place within the 'relevant period'.

The 'relevant period' is whichever of the following periods ends later:

• 14 weeks beginning from the first day on which the worker worked for the hirer having been supplied by the employment business
• eight weeks starting from the day after the day on which the worker last worked for the hirer having been supplied by the employment business

Where there has been more than one assignment care must be taken in calculating the correct start date for the 14-week period. If there was a break of more than 42 days (six weeks) between assignments this will break continuity and the later assignment will be taken as the first assignment. Where there has been a break of 42 days or less this will not trigger the start of a new 14-week period.

Temp-to-third party fees

If you supplied a worker who your client introduced to a third party you can charge a transfer fee following the same principles as a temp-to-perm or temp-to-temp fee - but you do not have to offer the client a choice between the transfer fee and an extended period of hire.

Situations where you introduce but do not supply a temporary worker

If you introduce a worker rather than supply them you can charge a fee - often called an introduction fee.

The fee should follow the same principles as the temp-to-perm and temp-to-temp fees but there is no limit on the period during which such a transfer must occur. The hirer must be given the option to have the worker supplied by you for a specified period of hire, at the end of which the worker will transfer without charge instead of paying the transfer fee. There is no limit on the agreed specified period of hire or the level of the transfer fee.