Government response to consultation on labour market exploitation

18 January 2016

The Department for Business, Innovation & Skills has published its response to the consultation on labour market exploitation and outlines its next steps.

This consultation asked for views on a range of proposals to improve the effectiveness of the enforcement of employment rights to protect workers from exploitation. To follow are the proposals and the next steps that the Government plan to take:

Establishing a statutory Director of Labour Market Enforcement who will set priorities across enforcement bodies (HMRC National Minimum Wage team, Employment Agency Standards (EAS) Inspectorate and the Gangmasters Licensing Authority (GLA)) dealing with everything from criminal activity to payroll errors.

  • The Government included legislation to create the role of a new Director of Labour Market Enforcement in the Immigration Bill, introduced into Parliament in September 2015. Amendments will be made to the Bill to ensure the function of the role is clear.

Creating a new offence of an aggravated breach of labour market legislation which will target those employers who deliberately, persistently and brazenly commit breaches of labour law, and fail to take remedial action. Being found guilty could lead to a custodial sentence.

  • A new type of enforcement order supported by a criminal offence for non-compliance is to be introduced. Under the proposals, the existing enforcement bodies would have the power to request a business, where there is reasonable belief that a labour market offence has been committed, to enter into an undertaking to take steps to prevent further offending. An order would also be available as a sentencing option where a labour market offence had been committed. Breach of the order would be an offence, punishable by imprisonment for up to 12 months. This will be taken forward through the current Immigration Bill.

Increasing intelligence and data sharing between the existing enforcement bodies and also other bodies such as the National Crime Agency, police forces and local authorities to increase the targeting of enforcement.

  • Data sharing between the three enforcement bodies (EAS, HMRC’s NMW team and the GLA) will continue and existing gateways will be retained. A new Intelligence Hub will be created to give the new Director and the enforcement bodies the powers to routinely share data and intelligence on a more formal basis to improve current information sharing practice.

Widening the remit, increasing the powers and changing the name of the Gangmasters Licensing Authority (GLA) to enable it to deal with serious exploitation whether employed through an agency, gangmaster or direct employer. Trained staff will be able to use police-style powers so they can seek and use search warrants to secure crucial evidence.

  • The Government intend to reform the GLA’s mission, functions and powers to ensure that they can prevent, detect and investigate worker exploitation across all labour sectors, not only those in which it operates currently. The GLA will be renamed as the Gangmasters and Labour Abuse Authority.