The much-discussed Agency Workers Regulations come into force on 1 October: what rights do they in fact confer?

Employers have had since January 2010 to get to grips with the terms of the Agency Workers Regulations 2010 (SI 2010/93), that being when they were finalised and laid before Parliament. However, most often the mind only becomes focused when an implementation deadline is looming, such as now, with less than two months to go until 1 October 2011.

Designed to ensure that agency workers are given the same basic terms and conditions as permanent staff, the principle underlying the regulations is simple enough: a right to equal treatment. However, significantly, the regulations do not mean that agency workers automatically have employment status. An agency worker will still have no right to claim unfair dismissal, minimum notice or statutory redundancy pay unless they can establish they fall within the statutory definition of “employee”.

In broad terms, those whose services are supplied to a hirer through a temporary work agency (including an umbrella company, or a master or neutral vendor) are covered. The individual must either have an employment contract, or a contract to perform work personally, and this contract must be with the temporary work agency. However, they must work under the supervision and direction of the hirer when on assignment.

When does the right apply?

The regulations will apply to all agency workers who have worked in the same role, with the same hirer, for 12 continuous weeks. They are not retrospective; therefore, for those agency workers already on assignment, the 12 week qualifying period will only start from 1 October 2011.

Detailed provision has been made in the regulations aimed at preventing avoidance by employers. For example, any week during which an agency worker works will count as a full week, and any break of up to six weeks in the same role will be permitted. This means that weeks previously accrued can be carried forward and the clock starts ticking where it left off.

Breaks between work periods of up to 28 weeks for sickness or injury will also be permitted, and previously accrued time carried forward. However, where there is a break for maternity, paternity or adoption leave, the clock for calculating the 12 week period will continue ticking during the leave period for as long as the agency worker’s assignment was intended to last.

Equal treatment as to...?

From “day 1”, agency workers will acquire a right to access collective facilities, including the staff canteen, childcare facilities and transport services such as pickup buses. Agency workers will also have a right to be informed of any relevant vacant posts with the hirer.

Once the 12 week qualifying period has been completed, the agency worker will be entitled to equality of basic terms and conditions as if they had been recruited direct by the hirer, for as long as they remain in the same role. These basic terms are: pay, duration of working time, night work, rest periods, rest breaks and annual leave.

“Pay” includes any sums that the hirer would normally pay if the agency worker had been hired directly to do the particular role in question. The regulations set out what is included (e.g. wages; holiday pay; shift allowances; individual performance related bonuses), and excluded (e.g. sick pay; pensions; redundancy payments; maternity etc pay; non-performance related bonuses).

Enforcing the regulations

If an agency worker suspects she is working under unequal terms, she may request that the agency provide her with information about the basic terms and conditions of the hirer’s workers. The agency has 28 days to respond. If it fails to do so, the agency worker then has the right to request the information directly from the hirer. Information provided in response to such requests will be admissible in the tribunal and adverse inferences may be drawn where there is an unreasonable failure to respond or where statements provided are evasive.

The regulations provide that the agency and hirer will be responsible for any breach of the equal treatment rule each to the extent that it is responsible for the breach. If incorrect or incomplete information is provided by a hirer to an agency, liability can be pushed on to the hirer.

Remedies for breach of the equal treatment rule are a declaration of non-compliance, compensation and/or a recommendation for action. In addition, there may be scope to award compensation for injury to feelings. Should deliberate avoidance be found, the tribunal can make a punitive award of up to £5,000.

The regulations in practice?

A variety of responses to the regulations can be envisaged, e.g. avoidance, embracing the principles, or converting agency staff to employee status. The risks associated with any of these approaches will need to be weighed in the balance to ensure the best commercial outcome which marries flexibility with legality.


The Author
Jane Green, partner, Employment, Maclay Murray & Spens LLP; convener, Law Society of Scotland specialist accreditation panel
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