On April 6th 2004, the Employment Agencies Act 2003 introduced new employment agency regulations which were to have a major impact on the recruitment industry. The changes were the most significant new legislation in the recruitment industry since the 1970s, when the Employment Agencies act of 1973 and the Conduct of Employment Agencies and Employment Businesses Regulations in 1976 set down the rules for all employment agencies and business in Great Britain.

The new regulations were drawn up by the Department of Trade & Industry. They affect every company supplying temporary or permanent staff and were designed to give more flexibility and control to the hiring company. The regulations make it difficult or impossible for rogue employment agencies and businesses to operate contentious practices, giving clients newly drafted contracted terms of engagement that afford them a number of options that were previously dictated by the recruitment agency or business' own terms and conditions.

Following their publication, the DTI's Regulations were examined and approved by the Recruitment and Employment Confederation (REC).

Further information on the Employment Agencies Act 2003 can be obtained at http://www.legislation.hmso.gov.uk/si/si2003/20033319.htm