The wait is over for umbrella companies and contractors who work via umbrella companies as the Government has published their response to the ‘Conduct Regulations Consultation’. However, there is no need to get over excited as this is the initial response with a commitment from the Government that they intend to gather more evidence in the coming months. At this stage it would appear that there is no evidence to suggest that workers engaged through an umbrella companies are ‘vulnerable workers’.

The Government’s response to the consultation on the Conduct of Employment Agencies and Employment Businesses Regulations 2003 was published this week by the Department for Business, Innovation and Skills (BIS).

The BIS consultation, which was launched in March 2009, had sought evidence on whether workers supplied to a hirer through an umbrella company are at risk of being exploited following anecdotal evidence received from the Employment Agency Standards Inspectorate over recent years that vulnerable work-seekers are being coerced into operating through an umbrella company and opting out of the Conduct Regulations under Regulation 32.

The Government states that the consultation has not provided convincing evidence of vulnerable workers suffering detriment in this respect. It notes that the evidence provided by the professional bodies (such as APSCo) is that any changes would have an adverse impact on legitimate contractors who actively choose those arrangements, potentially raising their costs and administrative burdens. The Government will therefore not be removing the opt out at this stage.

However, the Government does intend to gather further evidence and we understand that they will be undertaking research in the New Year looking in particular at the scale and nature of low paid workers that are employed via umbrella companies.

The full Government response can be viewed here: http://www.berr.gov.uk/files/file52945.pdf

Source: APSCo 9th November Newsletter

Tags: BIS, department for business, innovation and skills, umbrella company news

This entry was posted on Monday, November 16th, 2009 at 4:30 pm and is filed under Jenrick Group News, Jenrick IT, Job Market News. You can follow any responses to this entry through the RSS 2.0 feed. Responses are currently closed, but you can trackback from your own site.