Recruitment agencies need common auto-enrolment date

The Recruitment and Employment Confederation (REC) has called on the government to agree a common date on which all recruitment agencies should automatically enrol agency workers onto a qualifying pension scheme.

Anne Fairweather, the REC’s head of public policy, said the current proposals, which involve introducing automatic enrolment over three years from 2012, will cause administrative problems for the recruitment market. She also said they will be confusing for people who work through several agencies.

The REC wants all agencies to have to enrol staff in the scheme at the same time. It is also calling for an extension to the ’19-day rule’, which requires employers to pay employees’ pension contributions on the 19th day in the month after which the deduction was made.

Fairweather said: “Extending this requirement when a worker is first auto-enrolled means that employers can hold the contributions in a holding account until the opt-out period has passed. The funds can then be repaid to the worker or sent to the scheme depending on whether the worker has opted out.

“This is particularly important to recruitment agencies that will be auto-enrolling hundreds of workers a month.”

The REC has been talking to the Department for Work and Pensions about the application of auto-enrolment to the agency work market for two years.

Fairweather said: “We remain concerned that there is not enough consideration given to the high turnover of staff in the market.”

There are around 11,000 agencies in the UK – total recruitment agency industry turnover for 2008-09 was £22bn.

Comments are closed.