Unscrupulous recruitment agencies are colluding with gangmasters to supply illegal workers in breach of employment law, often paying them below minimum wage and sending them to work in unsafe conditions.

Martin Smith, organiser at the GMB union, has urged agencies to clean up their act following his investigations into the issue.

“It is not just rogue, unscrupulous agencies”, he said, “sometimes they are respected, large agencies dabbling in a dodgy side of the market.”

Smith is the union’s representative on the newly-created Gangmasters Licensing Authority (GLA), which has been created to license gangmasters supplying cheap labour.

He claimed that gangmasters provide labour to many industrial companies around London and other large cities and were not just restricted to agriculture.

The GLA will meet for the first time at the end of April to discuss how to implement the Gangmasters Licensing Act, originally proposed in a Private Member’s Bill.

Andy Hogarth, managing director of Staffline Recruitment, contributed to the Temporary Labour Working Group, a consortium of retailers, labour providers, growers, suppliers and unions aiming to tackle the issue.

He said: “We should have done this five years ago. But the rules are going to make it harder for small independent operators.”