Industry figures have backed the Gangmasters Licensing Authority’s (GLA) clampdown on gangmaster licence holders and umbrella companies who abuse tax-free allowances for workers as a method of undercutting competitors.

Last week, the GLA announced that firms that breach these licensing standards will have their licences revoked. Should labour providers and umbrella companies fail to heed the warning, the GLA will take action from 17 February 2010.

Jeanette Barrowcliffe, finance director of Meridian Business Support, says: “We support the proposed actions by the GLA. Meridian Business Support continues to invest heavily in its own compliance department that regularly audits Meridian’s 73 nationwide branches and has successfully contributed in attaining ISO accreditations.”

Rav Cheema, managing director of travel and subsistence solutions provider Zeel Solutions, says he is pleased that the GLA and HMRC are taking corrective action to target non compliance in order to create a level playing field within the industry.

“There is still much uncertainty amongst recruitment agencies as to the compliance issues that arise from offering travel and subsistence, along with the legalities involved in using third parties such as umbrella companies.”