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Depending on the scale of operations and findings, recommendations should be made to address any risks or perceived risk.

»Ê¹ÚÌåÓýapp end user should be following due diligence checks as described in the Use of Labour Providers . »Ê¹ÚÌåÓýapp details obtained can be analysed looking at subcontractors - this may highlight further subcontractors either up or down the supply chain that merit further enquiry.

Post Visit -Due Diligence checks

A range of options are available depending on your findings. You may wish to make recommendations that will help the end user to minimise risks; along the lines of the following examples:

• Entering a clause in contract (or signed statement) with a labour supplier that subcontractors are not permitted
• If a labour supplier is not able to supply enough labour, it is recommended that the End User engage additional sub-contractors rather than leave this to the first tier labour supplier who may engage third parties that may or may not be compliant - obtain signed statement confirming that all workers are provided by the tier 1 supplier and no subcontract labour will be used (without notifying the End User)
• Enter a clause in the contract confirming that the workers provided by the labour supplier are not engaged via offshore company
• VAT detail checks to verify a valid VAT number is being used - Coventry office - 03000 538254 (see LPOG4510)
• If not already undertaken, introduce or improve current controls in place to provide an audit trail for workers supplied and hours worked:-
  • Time sheets procedure
  • Introduce daily time sheets to include names, hours worked and signature from worker and foreman. This will provide an audit trail that will confirm:
  • National Minimum Wage (NMW)/National Living Wage (NLW) is being achieved
  • Identity check to combat fraud
• Risk for End User is they could lose the right to claim back VAT on invoices connected to fraudulent evasion of VAT by any labour market supplier used
• If wages are paid cash - change to using banking system. This will provide an audit trail of amounts received and evidence that the labour market supplier is responsible for the workers.
• Due diligence leaflet provides advice on replacement businesses. If new business is supplying same workers as before - End User should obtain an explanation.
• Does the labour market supplier have sufficient insurances?

During a compliance check you may need to gather information from workers or other intermediaries involved in the contractual chain, i.e. interactions with third parties. You must not contact a third party as a matter of course. It must be proportionate given the facts of the case. You must keep a clear audit trail in the case papers showing why you consider third party enquiries to be necessary. Further guidance is available in COG906025