All you want for Xmas?

New licensing laws could mean casual labour is in short supply

Food firms could face critical labour shortages during the busy run-up to Christmas because only a third of labour providers have so far been approved by the Gangmasters Licensing Authority (GLA), one agency has warned.

From October 1 it will be illegal to use temporary labour unless the labour provider holds a licence. But Vital Recruitment's general manager Terry Waite said: "Unless there is a massive uptake between now and September 1 [the cut-off date for applications to be processed by October 1] employers will find their agencies aren't licensed and they won't be able to use them. Where is all the labour going to come from?"

The GLA estimated it would receive 1,000 applications. As Food Manufacture went to press it had issued 408 licences and a further 643 applications were in the pipeline, but according to labour providers there are many more in the market.

"If insufficient labour providers are licensed, the industry will incur difficulty," admitted the GLA chief executive, Mike Wilson. "There will not be a shortage of supply if labour providers come forward for licensing between now and September 1."

He stressed there was no guarantee an application would be successful, but provided it had been submitted before the deadline, a labour provider could continue to operate while its application was processed.

"Companies need to be asking their agencies now whether they have applied for a licence," said Wilson. "It's no good waiting until September, finding out they haven't and then trying to find workers elsewhere, because agencies will be overrun and they will find themselves with a problem."

James Strickland, group director of recruitment agency Omega Resource Group, said: "Any reputable agency supplying the food industry will be aware they need a licence, so I think the risk of disruption to labour supply will be small. However, I recently spoke to one large food company that knew very little about the legislation coming in."

Meanwhile, illegal workers will again come under scrutiny in home secretary John Reid's immigration shake-up announced last month.