Ever wondered whether the recruitment industry is regulated and whether agencies advertising jobs have rules they need to stick to? Read the answer here.
“Are recruitment agencies regulated?” It’s a very common question that is often asked about the recruitment sector and firms within it.
Many people believe that anyone can set up a recruitment agency and operate in any way they want because there aren’t any industry regulations or laws that govern how they behave.
But whilst it is true that anyone can establish a recruitment firm (although the best will have serious experience and skills in the field when they do), the recruitment sector in the UK is highly regulated and governed.
As experts in the sector here at Anne Corder Recruitment (ACR), we’ll explain below the rules that companies like ours need to fully abide by…
The key thing to know is that in the UK there are two important pieces of government legislation that apply directly to the recruitment sector – the Employment Agencies Act 1973 and the supplemental Conduct of Employment Agencies and Employment Businesses Regulations 2003.
These outline the way recruitment agencies can (and can’t) behave and set out the statutory rules they must follow. For example, they make clear that recruitment companies can’t charge candidates for finding them a job and must be open and transparent about any fees they charge for any additional services they offer (such as CV writing or training).
These regulations are overseen and enforced by the Employment Agency Standards Inspectorate (EAS), a government body that is part of the Department for Business, Energy & Industrial Strategy.
Their dedicated focus is on protecting the rights of workers by ensuring that recruitment agencies work fairly and within the law.
They investigate claims raised by agency workers and have the power to prosecute agencies and impose unlimited fines on those found to be breaching the rules.
In addition, they can recover unpaid wages or money owed to temporary workers, as well as any fees unlawfully charged to those looking for work or who have found a job through an agency.
In 2020/21, the EAS investigated 1,800 complaints against agencies, carried out more than 170 inspections, recovered more than £130,000 for workers, and successfully prosecuted two companies (as well as had agency directors disqualified from being company directors again).
So it’s obvious that although strict regulations exist, some companies and operators are far from legitimate and choose to work in unethical (and illegal) ways.
But the good news is that the vast majority of recruitment agencies fully comply with the regulations and have never been a cause for concern for the EAS.
What’s more, there are also a host of other regulations and rules that recruitment companies must follow that protect the rights of workers and job seekers.
These include the need to register with the Care Quality Commission (CQC) if they supply staff for jobs in the care sector (such as nursing), and the requirement to obtain a licence from the Gangmaster and Labour Abuse Authority (GLAA) if they source workers for food processing, packaging, horticulture, or agricultural roles.
In addition, there are many legal protections for employees and job candidates in place, such as Agency Worker Regulations that protect the rights of temporary workers, and the Equality Act 2010 that ensures that agencies and employers don’t discriminate in their recruitment or employment practices.
Agencies, like every other type of business, also need to fully comply with General Data Protection Regulation (GDPR) rules that govern how personal data is stored and used (and an individual’s permission to access it or have it deleted).
And they must fully abide by statutory advertising standards such as the CAP Code (the UK Code of Non-broadcast Advertising, Sales Promotion and Direct Marketing) that makes clear that job advertisements must be genuine, truthful, and attributable (identify who is advertising the role).
To demonstrate the fact that they comply with regulatory and industry standards, many recruitment agencies join highly regarded membership bodies such as the Recruitment and Employment Confederation (REC) or the Institute of Recruitment Professionals (IRP).
These bodies are focused on maintaining the highest standards in the industry and require their members to pass regular compliance tests to prove they are abiding by their Codes of Practice or Conduct.
As well as being a member of the REC, Anne Corder Recruitment is a member and advocate of the IRP and has been rated by them as an ‘employer of choice’.
As an ethical recruiter, ACR was also one of the first agencies in the UK to seek globally recognised ISO accreditation, which it has successfully held for more than 20 years (the company is fully ISO 9001 certified).
Thankfully, the number of recruitment agencies that choose to flout the law and operate outside of the mandatory regulations is low, however, there are a number that do.
Digital innovations have meant that some operators see themselves more as technology companies rather than recruitment agencies, although they focus on some of the ‘traditional’ services provided by more established firms, such as job advertising.
As such, some of these look to bypass or avoid the regulations that high quality agencies comply to, so it is always worth spending the time looking carefully at their accreditations and track record before making the decision on who to use.