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The Conduct of Employment Agencies and Employment Businesses Regulations 2003

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Regulation 4

SCHEDULE 1E+W+STRANSITIONAL AND SAVING PROVISIONS

1.  In this Schedule—E+W+S

the 1976 Regulations” means the Conduct of Employment Agencies and Employment Businesses Regulations 1976 M1;

the date on which these Regulations come into force” means the date on which the Regulations apart from regulations 26(7) and 32 come into force;

existing contract” means a contract entered into between—

(a)

an agency or an employment business; and

(b)

a work-seeker or a hirer;

before the date on which these Regulations come into force;

ongoing supply” means the continuous supply by an employment business of a particular work-seeker to a particular hirer to fill a particular position, which continuous supply commenced before the date on which these Regulations come into force and continues after that date;

transfer fee” has the meaning given by regulation 10(2); and

the transitional period” means the period of 3 months beginning on the day these Regulations come into force.

Marginal Citations

2.—(1) Subject to the following provisions of this paragraph, these Regulations apply in respect of existing contracts with effect from the date these Regulations come into force.E+W+S

(2) Regulations 5 (restriction on requiring work-seekers to use additional services), 6(1) (restriction on detrimental action), 10 (restriction on charges to hirers), 12 (prohibitions on withholding payment to work-seekers), 26 (charging fees to work-seekers) and 28(2) (prohibition on disclosure of information to current employer) shall not apply in respect of any existing contract during the transitional period.

(3) Sub-paragraph (4) applies after the end of the transitional period to existing contracts which on the date these Regulations come into force include any term, the inclusion of which is prohibited by regulations 6(1) and 12.

(4) The references in regulations 6(1) and 12 to including a term in a contract shall be construed as references to enforcing or seeking to enforce that term.

(5) After the day on which the transitional period ends, regulation 10 shall not apply to any right which has accrued on or before that day under any term, in an existing contract, which is described in regulation 10.

(6) Sub-paragraphs (7) and (8) apply after the end of the transitional period to any existing contract between an employment business and a hirer which does not provide for a hire period as referred to in regulation 10(1).

(7) For the purposes of regulation 10(1), the contract between the employment business and the hirer shall be regarded as making such provision as is specified in that regulation where—

(a)the employment business has given notice to the hirer stating that, instead of a transfer fee, the hirer may elect for a hire period of such length as is specified in the notice during which the work-seeker will be supplied to the hirer on terms no less favourable to the hirer than those which applied immediately before the employment business received the hirer’s election or, where there has been no supply, on the terms set out in the notice; and

(b)the employment business has given such notice to the hirer (and has not withdrawn the same) at any time from the day on which these Regulations come into force but before the work-seeker concerned—

(i)begins employment with the hirer; or

(ii)begins working for the hirer pursuant to being supplied by another employment business.

(8) For the purposes of regulation 10(3), the references to “the contract” and “the hire period referred to in paragraph (1)” shall be read as references to the notice referred to in sub-paragraph (7) of this paragraph and the hire period specified in that notice, respectively.

3.—(1) During the transitional period, regulations 2(2) (non-disclosure of information), 4(5) (provision of services to a worker conditional upon using other services provided by the agent), 9(9) (prohibition on detrimental treatment for termination of contract by worker) and 9(10) (prohibition on making remuneration conditional on receipt of payment from hirer) of the 1976 Regulations shall remain in force in respect of any existing contract.E+W+S

(2) During the transitional period, the Employment Agencies Act 1973 (Charging Fees to Workers) Regulations 1976 M2 shall remain in force in respect of any existing contract.

Marginal Citations

4.—(1) In regulations 7 (restriction on providing work-seekers in industrial disputes), 18 (information to be obtained from a hirer), 19 (confirmation to be obtained about a work-seeker), 20 (steps to be taken for the protection of the work-seeker and the hirer) and 22 (additional requirements in respect of professional qualifications or vulnerable persons), references to “supply” shall not include an ongoing supply.E+W+S

(2) Regulations 9(6)(b) (notification of changes in terms agreed with workers) and 9(11) (prohibition on supplying workers to replace those in industrial dispute) of the 1976 Regulations shall remain in force after the date on which these Regulations come into force in respect of any ongoing supply.

(3) Where the terms of an existing contract with a hirer are varied, the agency or employment business shall comply with the requirements of regulation 17 (requirement to obtain agreement to terms with hirers) before the first occasion on which it provides services to that hirer after the variation has been agreed.

5.—(1) Regulation 8 (restriction on paying work-seekers' remuneration) shall not apply to agencies during the transitional period.E+W+S

(2) In respect of any agency which, immediately before the day on which these Regulations come into force, was not required to maintain a client account by virtue of it having received no written request from a worker under regulation 7(2) of the 1976 Regulations—

(i)regulation 25 shall not apply; and

(ii)regulation 7 of, and Schedule 2 to, the 1976 Regulations shall remain in force,

during the transitional period.

(3) Regulation 25 and Schedule 2 apply in respect of all relevant money held by an agency (other than an agency described in sub-paragraph (2)) with effect from the day these Regulations come into force, but where—

(a)regulation 25 or Schedule 2 imposes a requirement on an agency to take action in respect of any money held by it within a certain period of time; and

(b)the event giving rise to the requirement to take that action occurred before the day these Regulations come into force;

that event shall be treated as having occurred on the day these Regulations come into force.

(4) Regulation 25 and Schedule 2 apply in respect of all relevant money held by an agency described in sub-paragraph (2) with effect from the day after the day on which the transitional period ends, but where—

(a)regulation 25 or Schedule 2 imposes a requirement on an agency described in sub-paragraph (2) to take action in respect of any money held by it within a certain period of time; and

(b)the event giving rise to the requirement to take that action occurred before the end of the transitional period;

that event shall be treated as having occurred on the first day after the end of the transitional period.

(5) In sub-paragraphs (3) and (4) “relevant money” means money held by an agency immediately before the day on which these Regulations come into force or immediately before the day on which the transitional period ends (as appropriate) which, if the money had been received on or after that day, would be money in respect of which regulation 25 or Schedule 2 imposes a requirement to take action.

6.—(1) Regulations 8 and 12 of the 1976 Regulations (records) shall remain in force in respect of any applications received before the date on which these Regulations come into force.E+W+S

(2) Regulations 3(4), 6(1), 6(3), 6(5)(b), 7(3), 9(6)(c), 10(4), 11(1) and 11(5)(b) of the 1976 Regulations shall remain in force in respect of any copies of advertisements, written statements and documents required to be kept by an agency or employment business under those regulations.

(3) Where an agency has arranged employment for a young person before the date on which these Regulations come into force, any duty of the agency under regulation 5(4) of the 1976 Regulations (duty to loan return fare) shall be unaffected by the revocation of those Regulations.

(4) Where an employment business has supplied a worker to work at a place outside the United Kingdom before the date on which these Regulations come into force, any duty of the employment business under regulation 11(3) of the 1976 Regulations (duty to pay worker’s return fare where hirer does not comply with his undertaking) shall be unaffected by the revocation of those Regulations.

Regulation 25

SCHEDULE 2E+W+SCLIENT ACCOUNTS

1.  In this Schedule unless the context otherwise requires—E+W+S

the expressions “accounts”, “books”, “ledgers” and “records” shall include loose-leaf books and such cards or other permanent documents or records as are necessary for the operation of any system of book-keeping, electronic, mechanical or otherwise and where an electronic system is operated, the information recorded on it must be capable of being reproduced in legible form;

accounting reference date” has the same meaning as it is given in section 224 of the Companies Act 1985 M3;

client” means any person for whom an agency acts and on whose account it holds, receives or pays out client’s money or a hirer from whom an agency receives a hirer’s deposit;

client account” has the same meaning as in regulation 25;

client’s money” means—

(a)

money held or received by an agency on behalf of a work-seeker (including money held or received by way of advance against payment to a work-seeker for work to be done by that work-seeker, where the terms of the contract between the work-seeker and the hirer stipulate that the advance is not repayable to the hirer in any circumstances); and

(b)

hirer’s deposits;

but shall not include money to which the only person entitled is the agency itself;

credit institution” has the same meaning as in regulation 25;

hirer’s deposit” has the same meaning as in regulation 25.

Maintenance of client accountsE+W+S

2.—(1) An agency may keep one client account or as many such accounts as it thinks fit.

(2) Every client account must be in the name of the agency, and the name of the account must include—

(a)the word “client”; and

(b)if the account contains money belonging to a single client, the name of that client.

3.  An agency may pay into a client account—E+W+S

(a)such money belonging to the agency as may be necessary for the purpose of opening or maintaining the account;

(b)money to replace any sum which for any reason may have been drawn from the account in contravention of paragraph 7(2); and

(c)money received by the agency which under paragraph 4(b) the agency is entitled to split but which the agency does not split.

4.  An agency which holds or receives money which includes client’s money—E+W+S

(a)may where practicable split such money and, if it does so, shall deal with each part thereof as if it had received a separate sum of money in respect of that part; or

(b)shall, if it does not split the money, pay it into a client account no later than the end of the second business day following the day on which it receives the money.

5.  An agency shall not pay into a client account any money other than money it is required or permitted by regulation 25(4) and 25(14) or this Schedule to pay into a client account, and an agency into whose client account any money has been paid in contravention of this paragraph shall, no later than the end of the second business day following the day on which it discovers the same, withdraw it and pay it to the person to whom it belongs.E+W+S

6.  An agency may withdraw from a client account—E+W+S

(a)client’s money properly required for—

(i)a payment to the client;

(ii)a payment to another person on the written request of the client provided that the agency has previously agreed with the client to make payment to that other person if the client so requests;

(b)client’s money properly required—

(i)for or towards reimbursement of money properly expended by the agency on behalf and at the written request of the client;

(ii)for or towards payment of the agency’s fees due from the client;

(iii)for or towards reimbursement of monies paid by the agency to the client representing the client’s remuneration from employment with a hirer, where the agency has paid such remuneration to the client prior to receiving the same from the hirer (or any person connected to the hirer);

where the client has agreed to such deduction in paper form or by electronic means and, in a case falling within sub-paragraph (b)(i) or (ii) the agency has delivered to the client an invoice or other written statement of the amount of the fee incurred or money expended;

(c)money (not being client’s money) to which paragraph 3(a) or 4(b) applies, to reimburse the person properly entitled to it;

(d)money which for any reason may have been paid into the account in contravention of paragraph 5, to rectify that contravention;

(e)client’s money required by law to be deducted from a work-seeker’s remuneration before such remuneration is paid to him;

provided that in any case under sub-paragraph (a) or (b) of this paragraph the money so drawn shall not exceed the total of the money held for the time being in such account on account of such client.

7.—(1) No money drawn from a client account under paragraph 6(b), (c) or (d) shall be drawn except by—E+W+S

(a)a cheque or electronic transfer drawn in favour of the agency; or

(b)a transfer to an account at a credit institution in the name of the agency not being a client account.

(2) No money other than money permitted by paragraph 6 to be drawn from a client account shall be so drawn.

(3) A withdrawal from a client account may only be made by a person who is an authorised signatory in accordance with the current mandate held by the credit institution holding the account.

8.  No sum shall be transferred from the ledger account of one client to that of another except—E+W+S

(a)with the consent of the client to whom the sum belongs; or

(b)where a work-seeker becomes entitled, under the terms of any contract with a hirer, to receive any money paid to an agency by way of hirer’s deposit.

9.—(1) Every agency shall at all times keep properly written up such accounts as may be necessary—E+W+S

(a)to show the agency’s dealings with—

(i)clients' money received, held or paid by it; and

(ii)any other money dealt with by it through a client account;

(b)

(i)to show separately in respect of each client all money of the categories specified in paragraph (a) which is received, held or paid by it on account of that client; and

(ii)to distinguish all money of the said categories received, held or paid by it, from any other money received, held or paid by it; and

(c)to show the current balance of each client’s account in the client’s ledger or to enable this to be readily ascertained.

(2)  

(a)All dealings referred to in sub-paragraph (1)(a) of this paragraph shall be appropriately recorded—

(i)in a clients' cash account or a clients' column of a cash account; and

(ii)in a clients' ledger or a clients' column of a ledger;

and no other dealings shall be recorded in such account, ledger, or, as the case may be, in such columns.

(b)All dealings of the agency relating to its business as an agency other than those referred to in sub-paragraph (1) (a) of this paragraph shall be recorded in a separate cash account and ledger or such other columns of a cash account and ledger as the agency may maintain.

(3) In addition to the accounts, ledgers and records referred to in sub-paragraph (2) of this paragraph, every agency shall keep a record of and copies of all invoices and of all statements under paragraph 6(b) (distinguishing between fees and disbursements) delivered or made by the agency to its clients.

(4) Every agency shall, within 21 days of the end of each calendar month—

(i)compare, as at the last day of the calendar month that has just ended, the total of the balances shown by the clients' ledger accounts of the liabilities to the clients, with the cash account balance;

(ii)prepare a reconciliation statement showing the cause of the difference, if any, shown by the above comparison;

(iii)reconcile the cash account balances with the balance shown on statements and passbooks of all client accounts, and money held elsewhere, showing the causes of any differences in the reconciliation; and

(iv)take appropriate action to rectify any differences.

10.—(1) Every agency who at any time during an accounting period is required to keep accounts and records under paragraph 9 above shall, within ten months of the end of the accounting period, have them inspected and reported upon by an independent person who is a member of any of the bodies listed in section 249D(3) of the Companies Act 1985 M4.E+W+S

(2) The agency must ensure that the reporting accountant’s rights and duties are set out in a letter of engagement incorporating the following terms and must honour the undertakings given in paragraphs (v) and (vi) of the letter—

(i)In accordance with paragraph 10 of Schedule 2 to the Conduct of Employment Agencies and Employment Businesses Regulations 2003 (“the Conduct Regulations”), you are instructed to report to me/this firm/this company whether in your opinion the requirements of regulation 25 of and Schedule 2 to the Conduct Regulations have been complied with or have been substantially complied with during the accounting period to which the report relates.

(ii)You may report that those requirements have been substantially complied with if in your opinion they have been complied with except so far as concerns trivial breaches due to clerical errors or mistakes in book-keeping, all of which were rectified on discovery, and none of which in your opinion resulted in any loss to a person entitled to client’s money.

(iii)If you report that in your opinion those requirements have not been complied with or substantially complied with, you must annex to your report a statement of the matters in respect of which, in your opinion, the requirements have not been complied with or substantially complied with.

(iv)If you are unable to form an opinion as to whether or not the requirements have been complied with or substantially complied with, you must specify in your report the matters in respect of which you have been unable to satisfy yourself, and the reasons you have been unable to do so.

(v)For the purpose of making your report under paragraph (i) above, I/we/this firm/the company undertake to provide you with particulars of all accounts maintained or operated at any credit institution by me/this firm/the company, in the course of my/our/its business as an employment agency during the period to which the report relates.

(vi)Subject to paragraph (vii) below, you must examine my/this firm's/this company’s accounts and records in order to enable you to verify whether they comply with the requirements of paragraph 9 of Schedule 2 to the Conduct Regulations, for which purpose you may request such further information and explanations as you may consider necessary, and I/we/the company undertake(s) to provide you with such information as you may request.

(vii)nothing in paragraph (vi) above shall require you—

(a)to extend your enquiries beyond the information contained in the documents produced to you, supplemented by such information and explanations as you may obtain from me/us/the company;

(b)to consider whether the accounts and records have been properly kept in accordance with paragraph 9 of Schedule 2 to the Conduct Regulations at any time other than during the period to which your report relates..

(3) An agency required to maintain a client account in accordance with regulation 25 and this Schedule shall keep displayed at each of its premises used for or in connection with the carrying on of an employment agency in such a position that it can be readily seen by persons resorting to those premises a copy (certified as a true copy by the reporting accountant) of the reporting accountant’s most recent report, but not any statement annexed to it in accordance with paragraph (2)(iii) above.

11.—(1) The accounting period shall, for the purpose of paragraph 10 of this Schedule and regulation 25, be determined in accordance with the following provisions of this paragraph.E+W+S

(2) The first accounting period of an agency shall be—

(a)in the case of an agency which has a client account or accounts established before the date on which these Regulations come into force, the period beginning with the day immediately following that date, and ending on a date not more than twelve months after that date or if the agency is incorporated under the Companies Act 1985, the agency’s accounting reference date whichever is the sooner;

(b)in the case of an agency which establishes a client account or accounts on or after the date on which these Regulations come into force, the period beginning with the date upon which the first such client account is established and ending with a date not more than twelve months from that date or if the agency is incorporated under the Companies Act 1985, the agency’s accounting reference date whichever is the sooner.

(3) Subject to sub-paragraph (4), subsequent accounting periods shall begin with the day immediately following the end of the agency’s previous accounting period and end with a date not less than six months and not more than twelve months after that date.

(4) In the event that the only client account maintained by an agency is closed on a date less than six months following the end of the agency’s previous accounting period, the accounting period in question shall end on the date upon which such client account is closed.

12.—(1) Every agency required to maintain a client account or client accounts in accordance with regulation 25 and this Schedule shall preserve—E+W+S

(a)all accounts, books, ledgers and records for at least six years from the date of the last entry therein;

(b)copies of all invoices and statements under paragraph 6(b) above as issued to clients, for at least six years from the date of such issue;

(c)all statements as printed and issued by the credit institution with which the relevant client account is held, for at least six years from the date of receipt of each statement by the agency;

(d)the records of all reconciliations required by paragraph 9 above, in each case for at least six years from the date upon which such reconciliation is produced;

(e)all reports made to it by an accountant under paragraph 10 above, in each case for at least six years from the date upon which such report is delivered to the agency.

(2) The records referred to in this paragraph may be kept either at the agency’s relevant business premises or elsewhere, provided that if they are kept elsewhere, the agency shall ensure that they are readily accessible by it and that it is reasonably practicable for any person employed by the agency at any of its relevant business premises to arrange for them to be delivered to the relevant business premises at which that person is employed.

(3) The records referred to in this paragraph may be kept in electronic form, provided that the information so recorded is capable of being reproduced in legible form.

(4) If no hard copy is kept of any information contained in a record kept in an electronic system, that information must be capable on reasonable notice of being reproduced in printed form.

13.  Where an agency holds money relating to a single client in a client account, the agency must account to the client for any interest earned on any sum that is held on behalf of the client for more than 10 days.E+W+S

Regulation 26

SCHEDULE 3E+W+SOCCUPATIONS IN RESPECT OF WHICH EMPLOYMENT AGENCIES MAY CHARGE FEES TO WORK-SEEKERS

Actor, musician, singer, dancer, [F1background artist, extra, walk-on] or other performer;

Composer, writer, artist, director, production manager, lighting cameraman, camera operator, make up artist, [F2clothes, hair or make up stylist,] film editor, action arranger or co-ordinator, stunt arranger, costume or production designer, recording engineer, property master, film continuity person, sound mixer, photographer, stage manager, producer, choreographer, theatre designer;

Photographic or fashion model;

Professional sports person.

Regulation 29

SCHEDULE 4E+W+SPARTICULARS TO BE INCLUDED IN AN AGENCY'S OR EMPLOYMENT BUSINESS'S RECORDS RELATING TO WORK-SEEKERS

F31.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .E+W+S

2.  Work-seeker’s name, address and, if under 22, date of birth.E+W+S

[F42A.  In the case of an employment business, any key information document required to be given by paragraph (13) of regulation 13A and any revised key information document required to be given by paragraph (15) of regulation 13A.]E+W+S

3.  Any terms which apply or will apply between the agency or employment business and the work-seeker, and any document recording any variation thereto.E+W+S

4.  Details of the work-seeker’s training, experience, qualifications, and any authorisation to undertake particular work (and copies of any documentary evidence of the same obtained by the agency or employment business).E+W+S

F55.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .E+W+S

6.  Names of hirers to whom the work-seeker is introduced or supplied.E+W+S

7.  Details of any resulting engagement and date from which it takes effect.E+W+S

8.  Copy of any contract between the work-seeker and any hirer entered into by the agency on the work-seeker’s behalf.E+W+S

F69.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .E+W+S

10.  In the case of an agency that is permitted to charge fees to work-seekers, dates of requests by the agency for fees from the work-seeker and of receipt of such fees, with copy statements or invoices, numbers and amounts; or, as appropriate, statements of dates and amounts of sums deducted from money received by the agency on the work-seeker’s behalf in accordance with regulation 25, to the extent that these are not required to be comprised in records maintained in respect of a client account in accordance with paragraph 12 of Schedule 2.E+W+S

11.  Details of enquiries made under regulations 19, 20 and 22 about the work-seeker and the position concerned with copies of all relevant documents and dates they were received or sent as the case may be.E+W+S

Regulation 29

SCHEDULE 5E+W+SPARTICULARS TO BE INCLUDED IN AN AGENCY'S OR EMPLOYMENT BUSINESS'S RECORDS RELATING TO HIRERS

F71.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .E+W+S

F82.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .E+W+S

3.  Details of the position(s) the hirer seeks to fill.E+W+S

4.  Duration or likely duration of work.E+W+S

5.  Experience, training, ability, qualifications, and authorisation required by the hirer, by law, or by any professional body; and any other conditions attaching to the position(s) the hirer seeks to fill.E+W+S

F96.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .E+W+S

F107.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .E+W+S

F118.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .E+W+S

9.  Details of enquiries under regulations 18 and 20 about the hirer and the position the hirer seeks to fill, with copies of all relevant documents and dates of their receipt.E+W+S

F1210.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .E+W+S

11.  Dates of requests by the agency or employment business for fees or other payment from the hirer and of receipt of such fees or other payments, and copies of statements or invoices.E+W+S

Regulation 29

F13SCHEDULE 6E+W+SPARTICULARS TO BE INCLUDED IN AN AGENCY'S OR EMPLOYMENT BUSINESS'S RECORDS RELATING TO OTHER AGENCIES OR EMPLOYMENT BUSINESSES

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

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