Memorandum submitted by the Gangmasters
Licensing Authority
1. INTRODUCTION
1.1 This paper explains the role and remit
of the Gangmasters Licensing Authority (GLA), emphasising issues
relating to human trafficking (particularly for forced labour).
2. BACKGROUND
TO THE
GLA
2.1 The Gangmasters (Licensing) Act 2004
paved the way for creating the GLA. Sponsored by the Department
of Environment, Food and Rural Affairs, the GLA is a non-departmental
public body and was set up in April 2005 to address worker exploitation
in agriculture, shellfish gathering and food processing and packaging
in the UK.
2.2 The regulatory means for achieving this
is through licensing those who supply or use workers to provide
a service in agriculture, shellfish gathering and food processing
and packaging. For shellfish industry, anyone who uses workers
to gather shellfish also needs to be licensed.
2.3 "Gangmasters", more commonly
referred to as labour providers, range from recognisable high
street employment agencies and businesses supplying large processing
plants to small scale operators with a few workers providing agricultural
services to local farmers.
2.4 The GLA finances its activities through
licence fee income and enforcement monies from Defra. The Secretary
of State has delegated his enforcement function to the GLA.
2.5 The Authority is directed by an independent
Board (see annex B for a list of the Board's members).
3. THE LICENSING
PROCESS
3.1 To obtain and retain a licence, labour
providers need to comply with the Authority's licensing standards.
These conditions cover:
— paying national minimum wage, tax,
National Insurance and VAT;
— no debt bondage, harsh treatment
or intimidation of workers;
— proper accommodation (where provided);
— employment rights (including no excessive
hours, recruitment and contractual arrangements);
— using only licensed sub-contractors;
and
3.2 These conditions are a reasonable range
of measures that should be in place in any well-run business complying
with the law. A licence will be refused or revoked if critical
non-compliances are identified and/or total non-compliances exceed
a pass score. Licences can also be issued with additional licence
conditions, which have to be put right within a stipulated time
period.
3.3 The Authority started accepting licence
applications from 6 April 2006 (1 October 2006 for the shellfish
gathering industry). The table at annex A provides statistics
on the licensing scheme.
3.4 The Authority has memorandums of understanding
(MOU) with following organisations:
— Association of Chief Police Officers
(which includes UKHTC) and the Association of Chief Police Officers
in Scotland;
— Employment Agencies Inspectorate,
Department for Business, Enterprise and Regulatory Reform;
— Fraud Investigation Service, Department
for Work and Pensions;
— Health and Safety Executive;
— HM Revenue and Customs;
— National Minimum Wage Enforcement
Team, HMRC; and
— Serious and Organised Crime Agency.
3.5 These MOUs cover information sharing
(using the gateway under s19 of the Act) and joint working. These
agreements have created a framework for exchanging and collating
vital intelligence which has focused the Authority's and other
agencies operational work.
4. OFFENCES UNDER
THE ACT
4.1 It is an offence to:
— operate as a gangmaster without a
licence; and
— use an unlicensed labour provider.
4.2 The maximum penalty for operating without
a licence is a prison sentence of 10 years and a fine. The maximum
penalty for using workers or services provided by an unlicensed
gangmaster is a prison sentence of 6 months and a fine of £5000.
As well as the criminal offence of using an unlicensed labour
provider, it is also an offence punishable by up to 51 weeks imprisonment
and a fine to:
— intentionally obstruct a GLA officer
in their duties;
— fail to comply with a request of
a GLA officer without reasonable cause; and
— provide false information or provide
a false statement to a GLA officer.
5. SCALE AND
TYPE OF
ACTIVITY IN
THE GLA REGULATED
SECTORS
5.1 Independent research by the Universities
of Sheffield and Liverpool, commissioned by the GLA, presents
a picture of the licensed sectors. Key points in this research
include:
— The sectors regulated by the GLA
is dominated by migrant workers. 91% of licence holders (approximately
1,000 businesses) employ migrants is some capacity. 13% use overseas
agents to recruit workers.
— The majority of migrants supplied
to work in the licensed sectors are from the A8 countries.
— There is a considerable turnover
in the industry: 60% of respondents to survey conducted by the
researchers had been in the industry for less than five years.
Most workers appear to remain with a gangmaster for less than
six months before moving on
5.2 This research is available on the GLA's
website:
www.gla.gov.uk/index.asp?id=1013265
5.3 Research by Precision Prospecting[194]
in 2004 indicated there is between 420,000 and 611,000 temporary
workers in the GLA sectors.
6. GLA ROLE IN
TACKLING HUMAN
TRAFFICKING AND
OTHER ABUSES
Evidence of forced labour identified by the GLA
6.1 In six out of the seven most serious
cases where a licence has been revoked with immediate effect,
the GLA found evidence of the ILO's indicators of forced labour
(section 3 of the GLA licensing standards). The list below summarizes
the evidence found:
— intimidation of workers with threats
of violence;
— attempted forced evictions from accommodation;
— debt bondage—workers bound
to the employer in order to pay off debts;
— withholding workers wages; and
— threats to stop water and electricity
from accommodation if rent was not paid.
6.2 The GLA takes a serious view of any
evidence of abuse against workers amounting to debt bondage, harsh
treatment, threats of violence and intimidation. These types of
cases would indicate evidence of forced labour. In total, the
GLA has referred intelligence reports to the UK Human Trafficking
Centre for further investigation.
6.3 Employment must be freely chosen and
no-one must be retained against their will, whether or not there
is a debt owing. If a worker is lent money by the gangmaster to
meet travel or other expenses in order to take up a position,
they must be provided with details in writing of the amount loaned
and the agreed repayment terms. If loan repayments are deducted
from workers' wages, they must give their written permission for
this to be done. Workers should be aware of how to seek redress
or make a complaint where there has been harassment. There should
be no evidence that the gangmaster does not deal with such cases
properly.
Liaison and Cooperation UK organisations
6.4 The GLA has close links with the UKHTC.
The Authority is represented on the Centre's Prevention and the
Operations and Intelligence Sub Groups. There is also ongoing
work with the Authority and UKHTC to identify and care for victims
of trafficking. In addition, the GLA is represented on the SOCA
Programme 14/15 Board, which looks at trafficking issues.
6.5 The Authority also works closely with
the retailers and unions. The GLA recently held a conference with
all the major retailers and the Authority is in the process of
agreeing an action plan for collaborative working to identify
and tackle abuse. A similar arrangement is being discussed with
Unite.
Pilot to identify victims of trafficking for forced
labour
6.6 To improve understanding, a pilot is
planned with the aim of identifying victims of trafficking for
forced labour. The objectives of the pilot are:
— to increase our understanding of
the scale, scope and nature of human trafficking for forced labour
in the UK;
— to increase awareness and ability
to identify potential victims with front line staff, and to limit
the possibility of inaccurate identification;
— to improve an identification process
including a national referral mechanism to a competent authority;
— to improve access to accommodation
and support for victims; and
— to increase investigations and convictions
under section 4 of the Asylum and Immigration (Treatment of Claimants
etc) Act 2004.
6.7 The GLA is responsible for leading the
pilot in the East of England (which includes Lincolnshire, Cambridgeshire
and Norfolk). This is a traditional area of high gangmaster activity
where labour providers often operate across boundaries eg a gangmaster
can be located in Cambridgeshire, operate accommodation in Norfolk
and supply them for work in Lincolnshire. The pilot will commence
on 1 May 2008 and run for three months. The pilot is also running
in the West Midlands (led by the UK Border Agency) and North Yorkshire
and a further strand of work involving third sector partners in
London.
Liaison and cooperation with international organisations
6.8 The GLA is working closely with the
International Labour Organization (ILO) in its work on building
awareness of forced labour indicators. The ILO also uses the GLA
as an example of best practice as a policy response to tackling
forced labour (this includes GLA Director of Operations running
a training course for Moldovan officials).
6.9 The Authority is also in the process
of setting up MOUs with the largest source countries for workers
in the GLA regulated sectors. These agreements should further
facilitate mutual cooperation to identify and prevent exploitation
of workers,
including forced labour.
7. OTHER GLA
SUCCESSES
7.1 The GLA inspects licence holders and
conducts operations through an intelligence-led risk based approach.
The following are examples of the GLA's successes:
Bomfords, West Midlands, March 2007
An operation involving checks carried out on
multiple labour providers which led to all having their licences
revoked. All of the inspected providers supply workers to a major
food production site in the Vale of Evesham which in turn supplies
the major supermarkets.
Dynamic Workforce Ltd based in Smethwick in
the West Midlands was revoked with immediate effect due to concerns
with the immediate health and safety and welfare of workers.
Baltic Workteam Ltd, Cornwall, August 2007
Baltic Work Team Ltd had already had their licence
revoked by the GLA without immediate effect. A second investigation
found a significant threat to the health and welfare of 40 Bulgarian
workers led to revoking the licence with immediate effect.
Morecambe Bay, Cumbria, October 2007
Multi agency operation including the GLA, Cumbria
Police, DWP, H&SE, the MCA and local sea fisheries committee.
The GLA were checking that all shellfish gangmasters were licensed
and gathering further intelligence on the key players in the industry
alongside DWP efforts to check benefit claimants and H&SE
officers checking vehicles used and ensuring protective equipment
was worn by the cockle pickers. The joint working approach has
since led to a prosecution case for operating as a shellfish gangmaster
without a licence being put to Defra lawyers for consideration.
SIMMS AND
WOOD, EVESHAM,
DECEMBER 2007
Based on specific intelligence, the GLA conducted
an unannounced inspection at Simms and Wood, a vegetable packing
firm near Evesham. It was a joint operation with the West Mercia
Police and BIA. Three gangmasters had their licences revoked.
A to Z Employment Services Limited were revoked with immediate
effect, meaning that they had to stop trading immediately. The
main reasons for revoking the licence with immediate effect were:
— an illegal and seriously un-roadworthy
minibus being used to transport workers; and
— the boss of the agency instructing
a worker to put cling-film on a serious cut and to continue working
on a food production line.
Two other gangmasters have had their licence
revoked without immediate effect which allows them to continue
trading until the appeals process has been exhausted. Other serious
issues uncovered during the operation included:
— the manipulation of documents by
a labour provider. In the worst case one passport was copied four
times with a different name and a photo added in—the serial
number and signature on the passport remained the same; and
— no accurate record of the number
of workers or identity of workers employed to work at the warehouse.
VILNIUS RECRUITMENT,
SUFFOLK, JANUARY
2008
Vilnius Recruitment Ltd had its licence revoked
with immediate effect by the (GLA) for failure to ensure the safety
of the workers. The GLA found:
— cars used to transport the workers
still uninsured—despite prior warnings;
— accommodation charges that were unacceptably
high. (Attempts to hide the charges by deducting part of the money
directly from the workers own bank accounts after they had been
paid, meant that these figures did not show up on wage slips.)
— overcrowded accommodation;
— health and safety training and agreements
not in place;
— gas certificates for the workers'
accommodation were not available;
— agricultural minimum wage was not
paid;
— overtime was not paid; and
— workers did not receive holiday pay.
The GLA also revoked the licence of Goose Recruit
Ltd in April 2008. This company was based in adjoining offices
to Vilnius Recruitment and had the former Director of Vilnius
Recruitment heavily involved in the running of this company.
MORANTUS TRADING
AS 247 STAFF,
BURTON UPON
TRENT, MARCH
2008
This gangmaster who was supplying workers to
high profile bread, chocolate and salad companies had his licence
revoked after failing seven GLA standards including three critical
failures.
Workers were forced to use company accommodation
with deductions for rent taking their pay below national minimum
wage levels. The accommodation was of a poor standard and in one
case three adults two children and a baby were housed in a single
room measuring 2.8m x 3.8m on a double mattress a single mattress
and a child seat.
Some of the other problems that were uncovered
were: being forced to pay in full what was left of their 12 month
tenancy if they left their jobs and withholding money from workers.
ELS RECRUITMENT LTD,
CAMBRIDGESHIRE, APRIL
2008
An investigation led by the GLA and supported
by Sainsbury's and Produce World was carried out on 11 April 2008.
ELS Recruitment Ltd, based in Peterborough, was revoked with immediate
effect. Sainsbury's and Produce World worked quickly and secured
all of the workers continuing employment. The inspection found:
— a worker had allegedly been assaulted
by Mr Shamus Paul the Director of ELS Recruitment Ltd;
— workers had been threatened and verbally
abused by Mr Paul and ELS staff;
— on a regular basis hours were deducted
from workers' pay with no explanation;
— workers were told if they complained
they would be fired;
— workers reported being frightened
when the vans they travelled to work in were often overcrowded
leaving some workers sitting on the floor whilst travelling at
high speeds;
— workers were forced to use company
transport and paid at least £4.50 each a day for the privilege.
Anybody who did not use this transport was threatened with dismissal.
One worker stated he had to pay for transport even if they were
not working;
— workers were told they would not
be paid if they took holiday and there was no evidence that Statutory
Sick Pay had ever been paid;
— some workers were not given copies
of their contracts. Contracts of other workers contained false
details. Signatures of the workers appear to have been forged
by the agency. At least one worker was dismissed for questioning
these details;
— although ELS was responsible for
providing the workers with health and safety training there was
no evidence that training was provided. One worker stated that
the only training provided was "don't lose your knife";
and
— some of the workers who questioned
these practices or complained were dismissed.
VEHICLE STOPS,
LEICESTER AND
NORFOLK, APRIL
2008
The GLA held vehicle stops In conjunction with
local Police and VOSA officers, which led to a number of vehicles
used to transport workers being taken off the road. Issues identified
included, uninsured and banned drivers and suspicion of unlicensed
gangmaster activity that is currently being investigated.
8. FUTURE ACTION:
OPERATION AJAX
8.1 The GLA's work so far shows the organisation
has made a strong and positive start. However, problems still
exist. Therefore, the Authority is planning to announce the launch
of Operation Ajax: a programme of enforcement action designed
to be a bold and decisive response to protect workers from abuse.
"Operation Ajax" will involve a series of major unannounced
intelligence-led raids across the country over the next 2 years.
The Authority will work with other enforcement agencies, pooling
resources and intelligence. This operation will be formally announced
on 13 May with Jonathan Shaw, Defra Parliamentary Under-Secretary
of State for Marine, Landscape and Rural Affairs, and Frances
O'Grady, TUC Deputy-General Secretary, supporting the launch.
194 Precision Prospecting (2004a) Temporary workers
in UK agriculture and horticulture: a study of employment practices
in the agriculture and horticulture industry and co-located packhouse
and primary food processing sectors. Defra: London. Back
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