Recruitment and outsourced HR services provider Staffline has welcomed the Gangmasters Licencing Authority (GLA’s) move to clamp down on gangmasters and ‘umbrella companies’ who abuse tax free allowances for workers to undercut rivals.

The GLA announced yesterday that from 17 February, it will revoke the licences of any licence holders using salary sacrifice schemes which breach licensing standards.

Stafflineestimates that the overall cost to the Treasury of the continued use of this loophole, by both regulated and non-regulated sectors, as roughly £0.5bn.

Andy Hogarth, chairman and chief executive of Staffline, says: “We welcome the announcement from the GLA, which further highlights the misuse of salary sacrifice schemes to undercut those not using the schemes and is an encouraging step towards ensuring workers receive the wages and benefits that they are due.”