Regulation of the Private Recruitment Industry: BECTU response to UK government consultation
21 July 1999
BECTU welcomes the opportunity to respond to the Consultation Document. We have a number of members who fall into the categories listed in Schedule 2 with long and unfortunate experience of bad practice by employment agencies in the entertainment industry. We hope that the outcome of the consultation will be revised Regulations which will be clear and at the same time deliver meaningful protection for the work-seeker. We have a number of comments on the document as it stands.
4.13-4.19: Licensing
1. BECTU's view, and one we have consistently campaigned for, is that a licensing system for agents should be reintroduced in order to underpin the new Regulations. We believe that licensing should be based not on a 'rubber stamp' approach to applicants but on a notion of good standards and professional practices for agents.
2. The absence of a system of licensing based on good practice is costing work-seekers in the entertainment industry thousands of pounds in lost fees. Agents are allowed to establish themselves without any proper framework for conducting their business. BECTU handles approximately two cases per month where work-seekers join an agency, pay a significant fee and then find that the agent provides no future work or simply disappears without trace. This has become increasingly common in recent years as new agencies are casually established with no set-up costs and no system of vetting.
3. Any effective licensing system of course requires adequate resources for enforcement. We welcome, as far as it goes, the increased power conferred on the DTI inspectorate under the Employment Relations Bill eg increased time to bring prosecutions and a broader basis for prosecutions. We continue to believe, however, that the best means of controlling bad agents is at their point of entry to the labour market ie through a licensing system.
4. If the Government despite the strongly held views of BECTU, the TUC and many others does not reintroduce licensing, we would still look for the provision of better official guidance on good practice in the entertainment sector. Official statements on what constitute good practice for agents could - if widely distributed - provide a means of raising standards and exposing poor agents.
Bureau's details to appear on its correspondence (Reg 5)
5. We welcome this provision as we have come across a number of agencies that have attempted to conceal the nature of their business.
Making services conditional on the provision of other services (Reg 6.1)
6. We welcome the restriction on this practice. A number of our members in the entertainment sector have had the unfortunate experience of dealing with unscrupulous agents who have insisted in effect that the provision of work - finding services is conditional on payment for ancillary services which are vastly over-priced and which could be better provided by other means eg the compulsory ordering of printed CV cards at a charge of up to £100. This should rightly be made unlawful.
Industrial disputes (Reg 6.6)
7. As a trade union, we welcome the extension to employment agencies of the prohibition on supplying replacements for employees in industrial disputes. In our experience, provision of such replacement labour merely exacerbates the feelings involved in such disputes and contributes nothing to their resolution.
Notification of charges for ancillary services (Reg 11)
8. We support this as an appropriate supporting measure for Regulation 6.1.
Requirement to obtain agreement to terms (Reg 12)
9. Clearer written terms between the agent and the work-seeker in the entertainment industry is a necessary requirement. The union is constantly told of cases where work-seekers have been engaged for a job only to find out subsequently that they are not receiving the minimum agreed rates which had previously been indicated verbally.
Content of terms with work-seekers: Introducers (Reg 14)
10. This Regulation should be helpful in establishing the deductions a work-seeker can expect in the entertainment sector. BECTU has constantly come up against agents that have paid the work-seeker their money but without any breakdown of deductions.
More than one agency ('daisy chaining') (Reg 23)
11. The current Regulations have a clear gap in this area. It is not uncommon for both the worker and the hirer/employer to engage separate agents. If the Regulations concentrate only on the obligation of the worker's agent to pass monies on to the worker, this can lead to long delays where the money resides with the employer's agent who is seeking their own commission and over whom there is no Regulatory control.
12. We can therefore welcome the provision in Regulation 23.1 (d) whereby the worker's agent can only enter any arrangement with any other agency (eg the employer's agent) as long as it is clearly agreed that the money must flow directly to the worker or his/her agent rather than any other intermediary agency.
13. As with anyone else, workers in the entertainment sector have a right to be paid as soon as reasonably possible after completing their work. Any measure which begins to tackle double or multiple agency payment problems is therefore to be welcomed. However, this is only one aspect of the delayed payment problems our members face.
Client accounts (Reg 25)
14. BECTU welcomes the obligatory requirement in 25(1) that money held on behalf of work-seekers should be held in client accounts. The current Regulations, which provide only for client accounts on request, have not worked satisfactorily. In some cases we have even found agents who have not been able to identify clients' money separately on becoming insolvent.
15. We welcome the provision in 25(3) that money should be paid into a client account 'without delay' (ie 'within two working days').
16. We welcome the provision in 25(9) that agents must inform workers 'without delay' of the amount received. We believe, however, that there should be no minimum threshold before this applies. A worker has the right to be informed of each and every payment received on their behalf. Furthermore, for the avoidance of any dispute, we believe that the obligation should be for a written statement of monies received.
17. We have a major remaining concern on the Regulations concerning 'prompt payment to work-seekers by agents' ie Regulations 25(10), (11) (12) and (13). This provides a welcome time limit on the ability of agents to hold workers' money. However, this is fatally flawed by the 'get-out clause' in 25(10) which refers to 'each longer period....as the work-seeker has previously requested in writing.'
18. Work-seekers in the entertainment industry - and especially walk-ons - are simply not in a strong enough position to insist to their agents that they be paid promptly. Rightly or wrongly, they fear they may be disadvantaged in terms of obtaining future work. This means that agents will be able to continue to dictate how quickly the money is released to the work-seeker. In practice individuals in our sector may wait up to 6 months or even longer for payment. The new Regulations do not, as they stand, resolve this problem.
19. As an alternative, we would suggest the following:
- Either A/ remove any provision for a work-seeker to 'request' a longer period in which an agent may hold their money.
- OR B/ Inset a new Regulation under which an agent cannot deduct commission until they make the relevant payment to the worker.
Fee charging to work-seekers (Reg 26)
21. We entirely agree with the general arguments set out in section 6.8.2:
- that 'work is not something individuals should have to pay to do'
- that through charging, individuals may be trapped into 'not being able to afford to find work'
- that charging may also lead to attractive opportunities being 'only available to the well off, rather than those with the appropriate skills'
23. BECTU strongly believes that tight restrictions should be placed on charging, especially in the case of walk-ons. The document states (p71) that in the entertainment sector 'it is the norm for agencies to be employed by workers to represent them and to find them work'. We question whether this is an accurate description of the process in respect of walk-ons, who are typically not represented as individuals but supplied as a group according to the hirer's requirements. The notion of active individual representation does not necessarily apply here and indeed the casting books for which fees are charged are arguably more to promote the agents' interests than those of the walk-ons.
24. We believe there is an argument for removing walk-ons from the charging sector altogether. We further believe that book fees may not always fall within the definition of 'work-finding services' (although this is complicated by arguments as to what constitutes 'provision of information'). We believe, however, that the simplest solution lies in adopting the following measures:
- Introduce a cap on up-front fees (along the lines of the previous £40+ VAT cap for au pairs). Such fees should be redundable in the event that no work is found.
- Provide for other fees to be charged only after work has been found.
26. We support the proposal for a £1 limit on charges for such publications. This will help prevent vulnerable work-seekers from paying excessive charges in the hope of finding information on work opportunities.
Schedule 2
27. The list, particularly of non-performers, seems to us somewhat arbitrary and we would be interested in some clarification of the basis on which the list has been drawn up. We are emphatically not arguing for other occupations to be added to the list - simply seeking to understand the criteria behind the list as it stands.
Finally, we return to a point made above in the section on licensing. We believe that the revised Regulations will only have force if they are followed up with official and widely distributed sector - specific guidance in the form of statements of good practice for agents operating in the entertainment sector. The obligations on agents should be made widely known - both for the sake of workers in the sector (who face, unlike all other workers, charges for finding work) and also for those reputable agents who may otherwise be undercut by less scrupulous competitors.
We hope you will take note of our submission - and in particular the points on licensing, ancillary services, more than one agency, client accounts (point 19 above) and charging (point 24 above). We look forward to being informed of the further progress of the consultation.