Consent orders were made in the Federal Court of Australia, Brisbane recently against the Recruitment & Consulting Services Association Ltd following an internal review of its Code of Ethics and Practice Models.
In mid-2001, solicitors for the RCSA approached the Australian Competition and Consumer Commission with concerns relating to the Code and Practice Models suggesting that they contained exclusionary provisions in breach of the Trade Practices Act 1974.
The members of RCSA are recruitment agencies, private employment agencies and labour hire firms. There are approximately 3,000 members of RCSA across Australia and New Zealand. RCSA was established to promote and encourage ethical and professional procedures and standards amongst its industry members. Together, the Code of Ethics and Practice Models form a 'how to' manual of best behaviour by the members of RSCA. There are disciplinary provisions in the Code of Ethics providing for the imposition of warnings, fines, suspension of membership or expulsion from RCSA in the event of a breach.
The Code and Practice Models purported to impose various limitations or restrictions on the ability of RCSA members to supply or acquire services in a variety of situations; or contained provisions which lessened competition, or maintained a price. The RCSA acknowledged that the determination and imposition of sanctions under the Code and Practice Models would potentially have breached section 45 of the Trade Practices Act 1974.
Following an appeal from a decision of the RCSA’s Victorian/Tasmanian Divisional Disciplinary Committee imposing a fine upon a member, the RCSA reviewed its Code of Ethics and Practice Models.
As well as the consent orders, RCSA have also provided a formal undertaking to the ACCC that:
- acknowledges that the relevant determination and the suggested imposition of sanctions would potentially have breached section 45 of the Act
- rescinds the suspect Principles of the Code of Ethics and Practice Models
- withdraws disciplinary action against any member for alleged breach of the Code of Ethics and Practice Models
- provides compensation to members who have been subject to disciplinary proceedings within the last three years
- implements a trade practices compliance program with respect to Part IV of the Act within one month of signing the undertaking with full implementation to occur within four months.
RCSA will develop and maintain a trade practice education program to inform its members of the obligations imposed by the Act dealing with both restrictive trade practices and consumer protection.