282.Section 31 gives effect to Schedule 7 which amends the Employment Agencies Act 1973 (“the 1973 Act”). The effect of the amendments is set out below with deletions shown struck through and new text inserted in bold.
	Employment agency is defined in section 13(2) of the 1973 Act.
	Employment business is defined in section 13(3) of the 1973 Act.
	Employment is defined in section 13(1) of the Act as including employment by way of professional engagement or otherwise under a contract for services, and au pair arrangements.
283.Paragraph 2 of the Schedule clarifies and extends the power contained in section 5(1) of the 1973 Act for the Secretary of State to make regulations. It does so by amending and extending the list of matters in respect of which such regulations may in particular make provision, and by repealing the proviso at the end of section 5(1) which prevents the regulation of charges to employers.
284.These amendments make it clear that that the Secretary of State may regulate the provision of services covered by the 1973 Act to employers and those who are seeking work generally rather than specifically the persons presently identified in subsections 5(1)(f) and (g) of the 1973 Act. The amendment also provides that regulations may be made restricting the services provided by operators.
285.Examples of matters on which regulations might be made include:
	restricting the ability of employment agencies and employment businesses to vary unilaterally the terms of their contracts or other arrangements with workers or hirers;
	restricting the ability of employment agencies and businesses to make payment to a worker for work done by him conditional upon his doing other work;
	preventing employment agencies from purporting to enter into contracts on behalf of workers unless they are permitted to charge such workers for finding them work, and have a binding contract with them giving them authority to enter into such contracts; and
	restricting the ability of employment businesses and employment agencies to impose terms on employers which seek to prevent or discourage them from dealing, whether directly or through another employment business or agency, with workers supplied to them; or from referring such workers to other persons who might employ them. Where businesses seek to impose charges in any of these circumstances regulations might limit the size of those charges, time limit their application, or prohibit them altogether.
286.A new section 5(1A) is added to the 1973 Act which makes clear that the services which can be regulated under section 5(1) are not confined to those offered to UK residents seeking employment within the UK.
287.Paragraph 3 amends section 6(1) of the 1973 Act, which makes it unlawful, except where the Secretary of State prescribes otherwise, for employment agencies or businesses to charge persons seeking work for the service of finding or seeking to find them work. The amendment makes it clear how this prohibition applies to persons carrying on employment businesses. It also makes it clear that the prohibition applies in relation to the provision of information by persons carrying on employment agencies. The amended provisions make clear that the prohibition on employment businesses charging persons seeking work applies to services provided to those who are already under contract with an employment business (section 6(1)(b)) and to those who will be, once they have agreed to undertake an assignment with a hirer (section 6(1)(c)).
288.Exceptions to the prohibition might include fees relating to:
	the provision of employment agency services to entertainers, models and certain other limited groups where it is the norm for an agent to be engaged to represent the worker, except where the agent charges the person who hires the worker;
	the inclusion of information about persons seeking work in publications made available to employers or potential employers; and
	the provision of information about work opportunities to persons seeking work where no other services are offered, and where the charge for such information is within prescribed limits.
289.Paragraph 4 amends the inspection powers contained in section 9 of the 1973 Act. The range of premises that may be entered is extended by means of an amendment to section 9(1)(a) of the Act to “relevant business premises”, as defined by new section 9(1B). In addition to premises that may currently be entered, “relevant business premises” include premises which have been used in connection with the carrying of an employment agency or business; and (if a duly authorised officer has reason to believe records relating to an employment agency or business are kept there) other business premises used by a person who has carried or is carrying on an employment agency or business. New section 9(1)(d) provides that duly authorised officers may take copies of records and documents kept in pursuance of the 1973 Act or regulations made under it.
290.The power of entry contained in the 1973 Act does not permit inspectors to use force to enter; and it is restricted in its exercise to “all reasonable times”. The Act does not affect these limitations.
291.New section 9(1A) provides that, if any records, documents or information which an inspector is entitled to inspect are not kept at the premises being inspected, the inspector may require any person on those premises to inform him where and by whom they are held; and to require their production at those premises at a specified time, if reasonably practicable. New section 9(1C) ensures that the term “document” extends to information held other than on paper, and provides that such information is treated as being kept at premises if it is accessible from them.
292.The existing provisions against self incrimination contained in section 9(2) of the 1973 Act are replaced by new provisions (new sections 9(2), 9(2A) and 9(2B)) which take into account the judgement of the European Court of Human Rights in Saunders v the United Kingdom. They also provide an additional safeguard, in making it clear that inspectors cannot require production of material subject to legal professional privilege. The range of offences of obstruction and failure without reasonable excuse to comply with a request to furnish information contained in the existing section 9(3) of the Act is extended to include obstruction under the new section 9(1)(d) and failure without reasonable excuse to comply with a requirement under new section 9(1A).
293.Section 9(4)(a)(iv) of the 1973 Act is also amended, in order to allow information obtained using the compulsory powers contained in section 9(1) to be disclosed for the purposes of any criminal proceedings, rather than solely for those in relation to offences under the 1973 Act. Thus, for example, where the Secretary of State’s officers discover that a theft may have occurred, it will be possible for them to disclose information obtained using their compulsory powers to other prosecuting authorities for the purposes of criminal proceedings in relation to that offence, or in such proceedings brought by themselves, without committing an offence under section 9(4)(b) of the 1973 Act. This amendment does not, however, permit the Secretary of State’s officers to inspect documents other than those required to be kept under the 1973 Act or regulations made under it; or to require production of information other than to ascertain whether the 1973 Act or such regulations have been complied with or to enable the Secretary of State to discharge his functions under the 1973 Act.
294.Paragraph 5 inserts new sections 11A and 11B into the 1973 Act. New section 11A increases the time in which an information laid before a Magistrates Court or a Sheriff’s Court in Scotland is triable for any offence under the 1973 Act (other than that contained in section 9(3)) from six months to either three years from the date the offence was committed or six months from the date on which the Secretary of State comes to know of evidence sufficient to justify the prosecution, whichever is the earlier. New section 11B provides that where a conviction under the Act is obtained, costs not exceeding the costs of the investigation resulting in the conviction may be awarded to the Secretary of State.
295.Paragraph 6 replaces the existing section 12(5) and makes regulations under sections 5 and 6 of the 1973 Act subject to the affirmative procedure. Regulations and orders made under sections 13(7)(i) and 14(3) remain subject to annulment.
296.Paragraph 7 amends the definition of “employment agency” contained in section 13(2) of the 1973 Act. The substitution of the word “persons” for the word “workers” ensures that the definition of employment agency activity includes the supply of services to companies as well as individuals, in line with the definition of “employment business” activity in section 13(3).
297.Paragraph 8 replaces the existing section 13(7)(i) so that exemptions from the provisions of the Act can be made with more flexibility and precision than hitherto. The new provision would, for example, enable particular membership societies to be exempted from the Act insofar as they provide services to their members but to remain subject to the legislation in respect of services provided to non‑members.
Commentary on Sections Miscellaneous Section 31 and Schedule 7: Employment agencies