The Recruitment & Employment Confederation has today revealed the findings of its investigation into anti-competitive behaviour by seven recruitment businesses operating in the construction industry.

The REC Professional Standards Committee (PSC)’s investigation followed the four-year investigation by the Office of Fair Trading (OFT) into breaches of the Competition Act, which concluded in 2009.

According to a statement released this morning, the REC’s PSC issued a public reprimand against five of those recruitment businesses. “This follows detailed conversations with each of the businesses concerned and a robust review of the evidence provided that measures have been put in place to avoid future breaches. The reprimand will remain on their records for two years. Save for expulsion from the REC, this is the maximum sanction available to the PSC.”  

The five REC members are:

1.     Anders Elite

2.     Eden Brown

3.     Fusion People

4.   Henry Recruitment

5.  Randstad CPE (incorporating the former Hill McGlynn & Associates and Beresford Blake Thomas). 

At press deadlines, Recruiter was awaiting for responses from the companies involved.

All the above businesses concerned admitted to the OFT that they breached the Competition Act. Having admitted their breach of the Competition Act, the businesses listed above have all accepted that they have broken the REC Code of Professional Practice.

Hays Construction and Property (Hays), which was also found by the OFT to have breached of the Competition Act, and which was also fined by the OFT, escaped censure.  The statement said: “This is because Hays was not in REC membership when the offences occurred and so the REC cannot take any action under the REC Complaints and Disciplinary Procedure.

“However,” the statement went on to say, “Hays have participated fully in our investigation and have reassured the PSC and the OFT that they have taken all the steps necessary to fully comply with competition law.”

At press deadlines, Recruiter was awaiting a response from Hays.

The statement said: “The OFT found that all the organisations had taken adequate action to ensure no repeat breaches were likely to happen. Both the REC’s Professional Standards team and the PSC have sought and obtained assurances and tangible evidence that the businesses concerned have put in place a comprehensive range of measures to avoid future breaches. Specific actions include comprehensive reviews of internal processes and procedures, staff training programmes and detailed compliance audits.”

Phil Westwood, chair of the REC’s PSC, was quoted as saying:“We have looked at these REC members very carefully. They all accepted that by breaking competition law they also broke the REC’s Code of Professional Practice. Once this was established the PSC’s role was to apply the sanctions at our disposal. The PSC considered that on balance these were isolated incidents and that all of the businesses had addressed the short comings which created the offence in the first place. These members had convinced both the OFT and the REC that they had learnt their lesson and taken the necessary action to ensure that further breaches of the Competition Act and the REC Code of Professional Practice do not occur.

“This was a very serious breach and the PSC’s role is to ensure ongoing compliance on behalf of the membership. We decided to issue this public reprimand which will remain on the businesses’ records for two years. Any offence by any of these members in relation to the REC’s Code of Professional Practice during this period would be treated very seriously.”

Kevin Green, REC chief executive, said: “This has been bad news for our industry and our reputation has been damaged. We have investigated this breach of our Code of Professional Practice in line with our Complaints and Disciplinary Procedure. The PSC has taken the decision to publicly reprimand these members for two years and that is the right decision.

“However the wider lesson for the industry is to recognise the importance of ensuring all staff are trained to avoid anti-competitive behaviour, and that compliance with competition law is built into induction, training and company policies so that this will never happen again.”