Q&As

Can a temp agency restrict workers on their books from working directly for a client to whom they have been supplied by the agency?

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Published on LexisPSL on 05/09/2019

The following Employment Q&A provides comprehensive and up to date legal information covering:

  • Can a temp agency restrict workers on their books from working directly for a client to whom they have been supplied by the agency?
  • Conduct Regulations 2003
  • Restraint of trade and post-termination restrictions

Can a temp agency restrict workers on their books from working directly for a client to whom they have been supplied by the agency?

In answering this question it will be relevant to consider:

  1. whether the Conduct of Employment Agencies and Employment Businesses Regulations 2003 (Conduct Regulations 2003) apply

  2. whether a provision preventing a worker from working directly for a client of an employment business is void as a restraint of trade

Conduct Regulations 2003

The Conduct Regulations 2003 govern the conduct of the private recruitment industry, and set minimum standards for employment agencies and employment businesses operating from premises in Great Britain (ie England, Wales and Scotland). They apply where an employment agency or an employment business provides work-finding services to a work-seeker.

A recruitment business may be either or both of:

  1. an ‘employment agency’, ie a business such as a recruitment consultancy which introduces work-seekers to employers; once taken on, the work-seeker becomes an employee of the company to whom they were introduced (this is usually known as 'permanent recruitment'), or

  2. an ‘employment business’, ie a business that arranges temporary work for work-seekers with a ‘hiring company’; the temporary worker (often referred to as an ‘agency worker’) is paid by the agency rather than by the company to which they are supplied (usually known as ‘the supply of temporary workers’ or ‘the supply of agency workers’)

A

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