The Office of Fair Trading (OFT) is investigating recruitment firms working in the construction industry over alleged price fixing and other anti-competitive practices.
If true, the allegations could mean that employers in the construction industry have been paying artificially inflated recruitment fees.
John Fingleton, OFT chief executive, said: “If proven, the alleged practices in this case would amount to serious breaches of the law.”
The OFT has set out its ‘proposed findings’ against a number of firms – A Warwick Associates, Beresford Blake Thomas, CDI AndersElite, Eden Brown, Fusion People, Hays Specialist Recruitment, Henry Recruitment and Hill McGlynn Associates – but said the companies would have an opportunity to respond before a final ruling and that it should not be assumed that they have broken the law.
With more than 10,000 recruitment firms in the UK, price fixing is extremely rare, according to Anne Fairweather, head of public policy for agency body the Recruitment and Employment Confederation.
“It’s not like with the major supermarkets, where you only have four or five to choose from,” she said.
She recommended that to get the most competitive rates, employers should phrase recruitment tenders to encourage smaller, local recruitment firms to bid.