UK Procurement Officials Opt for Newer Code to Replace Some Older Language Found in Contracts

UK Procurement Officials Opt for Newer Code to Replace Some Older Language Found in Contracts

Source: MSP News

The government of the United Kingdom is known for celebrating tradition – but not when it can add extra operating costs.

The UK government says it is moving away from “pay when paid” clauses – often found in contracts between recruitment companies – and is opting for using a newer code backed by an industry association. The old clauses were used in contracts from recruitment process outsourcing (RPO)/ managed service provider (MSP) firms. The older clauses, too, have led to cash flow problems for recruitment companies, according to a statement from the Government Procurement Service (GPS).

Instead, the GPS will use the new APSCode – offered by the APSCo (the Association of Professional Staffing Companies), a UK industry group. Other RPO companies, including ManpowerGroup, are also switching to the APSCode, the organization said in a recent statement.

An example of the changes is that the APSCode says contracts between a recruitment firm and an RPO/MSP need to specify a “backstop date.” That is the deadline when payment must be made to the recruitment firm. If payment is not made on that date, there needs to be recourse, like the end-user client getting contacted directly.

“The Government Procurement Service will be supporting the Code of Conduct as it aligns with much of what the Government is trying to achieve with regards to transparency and fairness for all parties in the Supply Chain,” Matthew Griffin of GPS said in a recent press release. “We will be asking those managed service providers that we engage with to support the Code. We will also be working on a sustainable model to speed up payments to days rather than months.”

Ann Swain, CEO of APSCo, said that the pay when paid and non-assignment of debt clauses found in older contracts “were causing major cash flow funding problems for recruitment companies. The new Code marks a huge step forward for those recruitment organizations engaging with RPO and MSP by addressing this issue.”

“The endorsement by both the Government and a world-leading RPO [ManpowerGroup] is testament to the strength and robustness of the Code of Conduct – a Code that will benefit all parties in the Recruitment Supply Chain,” she adds.

GPS provides procurement savings for the UK public sector. It is the biggest professional buying organization (PBO) in the UK public sector. It covers eCommerce, energy, fleet, information and communications technology, office solutions, professional services, property and facilities management and travel, the agency says.

It focuses on the central government and the UK public sector such as defense, education, emergency services, health, local government and not-for-profits, the agency said in a statement.

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