Should I opt in or out of the Employment Agency Regulations?

The Employment Agency Regulations seek to protect temporary workers, however there are advantages to opting out if you are working via a limited company.
These regulations affect the relationship you have with your employment agency, and the relationship that your agency has with your client. They seek to protect temporary workers, including independent professionals and consultants, whilst also changing the way that agencies can charge their client should the client retain the temporary worker in permanent employment. By default you are opted in to the regulations, meaning that your agency must pay your fees regardless of whether your client has been paid by your agency. You therefore have a degree of protection if you are opted in. 

However, if you are opted in, your agency is required to carry out extensive background checks on you, and because of this they may not wish to consider you for assignments. 

For independent professionals working through a limited company, there is an option to formally opt out of the regulations, and there are advantages in taking this course of action. By opting out you are showing that you are not controlled by your client, which also sends a positive message to HMRC about your employment status. This could have a beneficial effect with regard to IR35 and the Agency Workers Regulations. 

It is therefore recommended that you opt out of the regulations, and this is done by signing a declaration before being introduced to the client. Your agency will help you with the documentation.

Amy FowlerShould I opt in or out of the Employment Agency Regulations?