A quarter of UK recruitment agencies are unsure whether recent HMRC legislation will affect their business and many aren’t recording important documentation for health and safety acceptance, DBS checks and Professional Indemnity insurance certificates.

That’s the view from recruitment software specialist Mercury xRM, which polled a select number of recruitment agencies to determine how well compliance issues are understood by both permanent and temporary recruitment agencies. The empirical research found that while 67% of agencies are having to adapt their processes to cater for legislative changes from HMRC, eight per cent do not expect to be affected and 25% have no idea whether or not the changes will affect their existing recruitment processes.

The survey also found that while agencies questioned find it easy to report basic details of candidates such as their name, address, and identification details, 40% do not know how to report unique taxpayer details, and do not currently record documentation for health and safety acceptance or DBS checks. A further 30% do not record documentation for anti-bribery and Professional Indemnity insurance certificates.

Employment intermediaries (including temporary recruiters) are now legally required to record and submit information regarding their contractors on a quarterly basis to HM Revenue & Customs as of 6th April 2015. Information required includes details of the worker including address, postcode and national insurance number, assignment start and end dates, amount paid and contact details of the intermediary themselves. Agencies that do not comply face heavy fines.

While the survey found that recruiters are experiencing difficulties understanding all the compliance procedures they must adhere to, the role of recruitment software is playing an important role in helping to ensure compliance. Sixty-four per cent of people questioned said that their recruitment software can handle changes in compliance and legislation, compared with 36% who said it doesn’t, or they are unsure. The same number of agencies said that their existing software also supports non-standard client commercial requirements, and 100% have processes in place to at least ensure contractors are compliant at the start of an engagement.

In response to the statistics, Mercury xRM, which is now an approved supplier to all ARC (Association of Recruitment Consultants) members, has launched its very own recruitment compliance self-assessment guide via its website. The useful tool presents agencies with a series of scenarios that can help determine how well they are staying on top of changes in compliance, and assist them in a spring clean of their processes.

Marketing Manager at Mercury xRM, Mark Britton commented: “While it is encouraging to see that all the agencies we spoke to are making a conscious effort to remain compliant at the start of an engagement, it’s worrying to see that many are struggling to remain compliant when new changes are introduced. 

“We make a conscious effort at Mercury xRM to ensure that our recruitment technology supports all changes in compliance and legislation to help our customers remain within the law. As technology that is developed by recruiters for recruiters, we understand the issues affecting the industry and work hard to ensure that our software supports best practice in all areas of recruitment. We also work closely with bodies such as the REC and the ARC, who do a great job working with agencies to enforce compliance.”