Do you need a licence to start a recruitment agency in the UK?

Why most agencies need no licence

Employment agencies were once licensed. The Deregulation and Contracting Out Act 1994, section 35, replaced that licensing. Today an agency in England, Scotland or Wales can start trading without applying to anyone, but it must follow the Employment Agencies Act 1973 and the Conduct Regulations 2003 from day one.

Instead of a licence up front, the state enforces after the fact. The Fair Work Agency can seek undertakings and orders, breaches are offences punishable by a fine, and the Secretary of State can seek a prohibition order banning someone from running an agency for up to 10 years. Northern Ireland has its own regime and inspectorate.

Who needs a gangmaster's licence

The Fair Work Agency's licensing scheme covers agriculture, horticulture, shellfish gathering and the associated processing and packaging sectors. Processing and packaging any product derived from agriculture, fish or shellfish is in scope, which takes in food and drink such as ready meals, cheese, confectionery and alcohol. It does not matter whether the workers are temporary or permanent, employed, agency or self-employed.

You are also acting as a gangmaster if you use workers to gather shellfish, direct gatherers to a particular bed, buy a catch directly from gatherers, or buy a crop and use workers to harvest, process or pack it.

The guidance lists further exclusions, including some farmer-to-farmer arrangements, recognised apprenticeship training agencies and some skilled workers. Read the detailed guide before assuming one applies to you.

What happens if you supply without one

Acting as a gangmaster without a licence is a criminal offence with a maximum penalty of 10 years in prison and a fine. A labour user who takes workers from an unlicensed gangmaster also commits an offence, with a maximum of 6 months in prison and a fine. That is why food and farm clients ask for your licence number before the first booking.

The GLAA is now the Fair Work Agency

The Fair Work Agency launched on 7 April 2026. It brought together the Gangmasters and Labour Abuse Authority, the Employment Agency Standards Inspectorate and the Office of the Director of Labour Market Enforcement. Gangmaster's licences are now issued by the Fair Work Agency. If older guidance, client paperwork or a tender mentions a GLAA licence, it now means a Fair Work Agency licence.

To ask whether you need one, the Fair Work Agency gives licensing@fairworkagency.gov.uk and 0345 161 6000 on its guidance.

Registrations that are not licences

No licence does not mean no paperwork. A new agency still registers a company or tells HMRC it is self-employed, registers as an employer before the first payday, buys employers' liability insurance, pays the ICO data protection fee, and registers for VAT when turnover passes £90,000. Care work brings its own regulators for the services you supply into. Our start-up guide lists each step with its source.

Tempbench, the CRM for UK temp agencies, holds documents and expiry dates for each candidate. It does not track your agency's own licence or registrations.