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These long-debated regulations mainly come into force on 6 April 2004. They apply to all kinds of employment agency and employment business. This note is about only some of the key provisions, and only those that will affect agencies which (continuing a previous exemption) may charge fees to the work seekers they represent, in those occupations listed in Schedule 3 which now include any:
- Actor, musician, singer, dancer, or other performer;
- Composer, writer, artist, director, production manager, lighting cameraman, camera operator, make up artist, film editor, action arranger or co-ordinator, stunt arranger, costume or production designer, recording engineer, property master, film continuity person, sound mixer, photographer, stage manager, producer, choreographer, theatre designer;
- Photographic or fashion model;
- Professional sports person.
The regulations themselves include the following five key sections:
- General obligations (regulations 5 - 12);
- Requirements to be satisfied before services are provided (regulations 13 - 17);
- Requirements to be satisfied in introducing or supplying a work seeker to a hirer (regulations 18 - 22);
- Special situations (regulations 23 & 24);
- Client accounts and charges to work seekers (regulations 25 & 26).
The agency may not require the work seeker to use other chargeable services, or to hire or buy goods, from the agency (regulation 5). The agency may not threaten the work seeker with any detriment for having terminated any contract between the work seeker and the agency (regulation 6). The agency may enter into a contract on behalf only of a work seeker who is in one of the occupations mentioned above (regulation 11).
When the agency first provides services to a work seeker it has to give notice of being entitled, under the above exemption, to charge fees to the work seeker, and the agency must obtain the work seeker's agreement to the terms of the agency representation (regulation 14). Those terms once notified will not be variable by the agency without the agreement of the work seeker. If changes are so agreed the agency must by the end of the fifth following business day give the work seeker a single document containing the agreed terms and the date the variation takes effect.
Additionally the agency will now under regulation 16 have to notify:
- details of the work finding services;
- the terms on which the agency is authorised to enter into contracts with hirers;
- confirmation if the agency is authorised to receive money on behalf of the work seeker;
- details of the fees which may be payable to the agency for work finding services; and
- any notice the parties must give to terminate the representation.
While the agency is not prevented from charging a hirer in relation to work introductions, the agency must notify a hirer of terms which will apply between the agency and the hirer for those services including any fee payable by the hirer and the circumstances if any in which any refund or rebate could be payable to the hirer (if at all) (regulation 17). If the agency is to act on behalf of the hirer then the terms will also need to be agreed and set out in a single document provided to the hirer as soon as practicable.
Not all the regulations will require special efforts in all situations. For example, under regulation 18 the agency may not introduce work seekers unless it has sufficient information from the hirer to select a suitable work seeker. The list may at first look daunting as it includes:
- the hirer's identity and nature of business;
- the date when the hirer requires a work seeker to start work and the duration of the work;
- the position the hirer seeks to fill, the locations and the hours during which the work is required and any risks to health or safety known to the hirer and what steps the hirer has taken to prevent or control such risks;
- the experience, training qualifications and authorisation the hirer considers necessary for a work seeker in order to work in the position which the hirer seeks to fill;
- any expenses payable by or to the work seeker;
- both the minimum payment and other benefits the hirer would offer to a person in the position concerned and the intervals at which payment would be made; and
- where applicable, the length of notice the work seeker would be required to give or be entitled to receive, to terminate.
Despite this daunting list, in the case of a music booking agency, typically the hiring contract will take care of most of the above details where the hirer is a regular music promoter. However the agency may now have to make more effort to fulfil the obligations as to health and safety risks.
Under regulation 19 the agency may not introduce work seekers unless it has obtained confirmation that the work seeker has the "experience, training, qualifications and any authorisation which the hirer considers are necessary, or which are required by law or by any professional body, to work in the position which the hirer seeks to fill; and that the work seeker is willing to work in the position which the hirer seeks to fill."
How this will affect performance contracts, modelling contracts and sport performer contracts remains to be seen. Hirers can argue that individual inexperienced artists, sports people or models would not be acceptable but of course this will not be a problem where only one individual work seeker or known group of work seekers is of interest to the hirer.
Under regulation 20 the agency must take all reasonably practicable steps to ensure that work seeker and hirer are each aware of relevant regulatory requirements applicable to the work and must also make all enquiries reasonably practicable to ensure it would not be detrimental to the interests of the work seeker or the hirer for the work seeker to carry out the work concerned. If an agency receives information indicating that the work seeker may be unsuitable the agency must inform the hirer without delay – meaning the same or the next business day (regulation 20). How these obligations will be discharged in practice also remains to be seen.
Agencies must now operate client accounts on behalf of work seekers (regulation 25). The funds concerned include any advances but do not include a hirer's deposit if it may be repayable to the hirer. Also the agent must provide statements along with payments to the work seeker which set out when and from where the payment derived, to what work it relates, and what fees or other deductions have been made by the agency. Exceptionally, an agency acting in respect of the exempted occupations described above may deduct its fee from any sum paid to the work seeker or into a client account but the work seeker must have agreed to the deduction concerned under the engagement with the agency. This is likely to be the provision which triggers agencies to review their agency agreements with their work seeker clients as soon as possible, and to review any other particular terms which the agency wishes to negotiate with the work seeker such as periods of exclusivity, notice and any other applicable charges or deductions.
Under regulation 29 agencies are required to keep much more detailed records of the work seekers they represent, and the hiring arrangements they have made, though the records may be kept in electronic form provided the information is capable of being produced legibly.
Under regulation 30, civil liability attaches to failure to comply with these regulations by an agency. Consequently, it is not a commercially viable option for agencies to ignore these regulations. Richard Taylor
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