Recruiters who supply unlicensed gangmasters could face a £5,000 fine and up to six months in prison under new laws which came into force on 1 December.

"It takes two to exploit labour —the provider and the user," said Mike Wilson, chief executive of the Gangmasters Licensing Authority (GLA). "We have introduced the GLA licensing scheme to bring providers up to the mark. It is now time to look at the other side of the relationship — the labour user."

"We have already started to do this. A number of investigations have been opened and information and evidence is being gathered with expectation of early action."

The new law is primarily aimed at users of unlicensed gangmasters, but any recruiter supplying an unlicensed gangmaster faces liability.

All recruitment agencies providing gangmasters will have to own a licence, and licences can be checked on the GLA register. If an agency does not have a licence, both the "principal authority" in the business — for example, a chief executive — and the business itself could be punished.