The Conduct of Employment Agencies and Employment Business Regulations 2003, more commonly known as Conduct Regulations or Conduct Regs, are a minimum set of standards that apply to recruitment agencies to ensure that both candidates and end clients are protected and treated fairly.
The regulations are designed to apply to anyone who is supplied through a recruitment company, regardless of whether you operate through Umbrella, CIS Self Employed or a Limited Company.
1) Information required from/given to the client and provided by/to the contractor;
2) The contractual documentation that must be in place;
3) When a contractor must be paid, particularly in instances where payment has not been received from an end client;
4) When transfer fees can be charged to the client.
If you work through a Limited Company, including an Umbrella company, you will be asked if you wish to opt-out of the regulations when you register or apply for a new role. If you wish to opt-out, you will be given a EAA Opt-Out form. This must be signed and returned before you are introduced to the end client and start your assignment, otherwise the opt-out could be invalid. You also have the ability to opt into the regulations again later once your assignment has ended.
If you are working with people under the age of 18 or vulnerable adults, you will not be able to opt-out as the regulations automatically apply to your assignment.
If you are working outside of IR35, contractors are usually encouraged to opt-out, as it supports their IR35 status. Given that control is an indication of employment and on the basis that the conduct regulations apply to contractors under the control of the end client. It is recommended to have an IR35 Review if you are unsure about your status. For more information on IR35’s, please see our guide here.
• You will receive payment for the work you have completed, even if the end client hasn’t paid the agency. The agency also cannot use the end client not signing a timesheet as a valid excuse for non-payment;
• You cannot be charged for using the agencies work finding services;
• You will be provided with terms outlining the essential aspects of the assignment, such as contract length and rate of pay;
• It restricts the agency’s ability to prevent you from entering into a direct contract with the end client.
• It can assist with demonstrating that you operate outside IR35 as it avoids the implication that you are always under the end client’s control;
• Reduces administration which helps to avoid increased costs and potential delays in starting your assignment;
• It can increase your marketability to clients and recruiters wishing to place contractors quickly.
Ultimately, the decision to opt-in or opt-out is entirely up to you and should be the result of an informed decision. We highly recommend doing your own research before coming to a conclusion. For more information, please see the government guidance on Conduct Regulations 2003.