Conduct Regulations 2003

What are the Conduct Regulations 2003?

The Conduct Regulations 2003 are rules that govern the conduct of the UK recruitment industry and protect the interests of work-seekers. The regulations ensure that employment businesses and agencies treat both candidates and clients fairly in relation to things like:

  • Information that has to be provided to the client and candidate

  • When a contractor must be paid

  • How a recruiter has to advertise job vacancies

What is an Employment Business?

An employment business hires an individual directly and then supplies them to work for an external client on a temporary basis.

What is an employment agency?

An employment agency supplies permanent recruitment services to a client. The employment agency supplies an individual who will be directly employed by the client.

How do the Conduct Regulations 2003 affect me?

All individuals to whom an employment business or agency provides work finding services are automatically protected by the Conduct Regulations 2003.

It means you’ll be entitled to certain information before you sign up for work-finding services and when you secure a role. It’ll also protect your pay, your health and safety, your rights in relation to working elsewhere and give you the right to make a claim for breach of the rights within the Conduct Regulations 2003.

If you work through an incorporated business, e.g. a Personal Service Company (PSC) or through an umbrella company, you can choose whether you want to opt out of the Conduct Regulations 2003. If you do not want to opt out, no action is needed from the PSC or umbrella company. You cannot opt out of regulation 13A of the Conduct Regulations 2003 that entitles you to receive a Key Information Document.

So, how do I opt out?

  • Your employment company can issue you with an opt out agreement.

  • The agreement must be signed by both the work-seeker in their individual legal capacity and their PSC or umbrella company in their legal company capacity.

  • The agreement must be in writing, given to the employment business and be in place before the work-seeker starts their assignment.

  • The employment business must inform the client of the opt out notice before the assignment starts.

Who can’t opt out:

  • If you don’t work via an incorporated business (e.g. PSC or umbrella), you cannot opt out.

  • Nobody can opt out of Regulation 13A – the Key Information Document.

  • If you are working through a PSC or umbrella but you are working with vulnerable people, then you are not able to opt out of the Conduct Regulations 2003.

      • A vulnerable person is any person who is under the age of eighteen (18) or any person who by reason of age, illness or other circumstance is in need of care or attention.

What is a Key Information Document (KID)?

Regulation 13A of the Conduct Regulations 2003 requires a Key Information Document to be provided to work-seekers to increase clarity for workers on pay related facts and other key details about their engagement. It gives workers immediate access to representative information about pay and how certain fees or deductions could affect their pay.

The KID must be given to workers before agreeing terms with the employment business, so the figures given in them are representative examples only and will not accurately reflect the exact amounts you will earn.

Can I withdraw my decision to opt out of the Conduct Regulations 2003?

Yes. Work-seekers who have decided to opt out can withdraw this decision but only when they have finished their assignment for the client who they chose to opt out with.

If the work-seeker starts a new position with the client or signs a new contract or has an amendment to an existing contract, it may be possible to withdraw the opt out at that point

Why opt out of the Conduct Regulations 2003?

Some individuals believe that if they are not receiving the protection of the regulations, it looks as though they are taking on more financial risk and believe that this will help with self-employed status. Opting out of the Conduct Regulations 2003 is not a fool-proof way to obtain self-employed status and you should always obtain specialist tax and legal advice before making any decisions.

Opting out can be perceived to provide greater flexibility. The regulations impose certain obligations on the work-seeker, such as requiring terms of service to be in writing, so the increased admin may be too time consuming for some individuals.

Can I be charged for using work-finding services?

Employment businesses are prohibited from charging work-seekers a fee for finding them work.

Employment businesses can offer other non-work finding services where a fee may be charged, such as CV drafting and formatting.

Record keeping:

Employment businesses and agencies are legally required to keep records to show that they have complied with the Conduct Regulations 2003. The records that an employment business or agency must keep relating to work-seekers and clients, include:

  • Personal details (name, age, DOB)

  • Details of work-seekers training, experience, or qualifications and any documentary evidence

  • Details of any engagement and the dates of the engagement

  • Any contracts that apply between the employment business and the work-seeker

  • Employment businesses are not required to keep details of a work-seeker if it does not provide any work finding services to the work-seeker but there may be other record-keeping requirements that apply under different legislation.

There are other record-keeping requirements under different bits of legislation, so an employment business or agency may not need to keep records to comply with the Conduct Regulations 2003 but may need to, to comply with other legal requirements.