Transparency needed between recruiters and candidates

Anna Scott

Last week shadow business secretary Chuka Umunna called on the government to hold a full inquiry into allegations that six recruitment agencies are mis-selling personal accident insurance to agency workers.

Umunna told Parliament that he has evidence that the agencies have profiteered from low-paid workers – already covered by their employers’ insurance – buying unnecessary insurance.

Business secretary Vince Cable responded that the Employment Agency Standards Inspectorate was “investigating individual cases and will take enforcement action”. He said if there is a suggestion that the practice is widespread then there will be a case for a “broad-based inquiry”.

Under the Conduct of Employment Agencies and Employment Business Regulations, staffing companies are prohibited from making their services conditional on agency workers purchasing accident insurance. It is also illegal for any accident insurance payments to take the agency worker’s pay below the national minimum wage.

Some of the agencies Mr Umunna named have vigourously denied the claims. And the Association of Professional Staffing Companies has said that it has not received any complaints involving its members.

Its head of external relations Samantha Hurley said APSCo is in dialogue with its members in order to ascertain whether any such activities have taken place and if so in what context.

However, the Recruitment and Employment Confederation stated that employment agencies are not doing anything wrong by offering workers the opportunity to purchase accident insurance.

“It’s a product that many other organisations offer to their members, including trade unions,” said director of policy and professional services Tom Hadley, adding that personal accident cover can be appropriate for workers in high risk sectors such as rail and construction.

The key issue here is transparency and openness. As Hadley points out, the REC’s code of conduct requires recruiters to show these qualities with their candidates. And, as Keith Faulkner, chair of tempo, says, temporary workers must have the benefits and limitation of such insurance clearly explained to them, along with the cost and what happens if they choose to take an assignment with another agency.

If the relationship between candidates and agencies is a straightforward as possible, and all requirements are clearly laid out, there shouldn’t be an issue. While this negative publicity for the sector may unwelcome, and whether an enquiry takes place or not, if it leads to more transparency, that can only be a good thing.