Agency Workers Regulations

Summary of Agency Workers Regulations

From 1 October 2011, eligible temporary agency workers will be entitled to equal treatment by comparison to permanent workers basic working conditions.

Scope of Regulations

The Regulations apply to temporary work agencies (employment agencies), agency workers and hirers.  The guidance states that the Regulations will not apply to individuals who find work through an agency but are in business on their own account, managed service contracts, in-house temporary banks, individuals who find direct employment with an employer through an agency, or individuals who are on secondment or loan.

On hearing a Claim that there is or has been a breach of these Regulations the Employment Tribunal will look at the reality of the relationship, not just the description of the relationship.  For example, simply putting earnings through a limited company would not in itself put individuals beyond the possible scope of the Regulations if the reality is that they are caught by the Regulations.

The guidance also confirms that an agency worker is someone who has a contract with the agency (typically an employment contract or an agreement to provide services personally), but who works temporarily for, and under the direction and supervision of a hirer.  The guidance sets out the key elements required and example characteristics of an agency worker.

In addition to existing statutory protections, the Regulations will introduce new entitlements for agency workers.

Day One Rights

From the first day of an assignment, an agency worker is entitled to the same access to certain facilities provided by the hirer.  The guidance confirms that this right will only extend to facilities provided to ‘help staff meet the demands of working in a particular location’.  Examples give include a canteen, crèche, car park etc.  It does not extend to ‘off site facilities’ or ‘benefits in kind’.  Agency workers will not therefore be entitled to subsidized off site gym membership, for example.

Failure to provide access to relevant facilities can be objectively justified if it is a ‘necessary’ and ‘appropriate’ way to ‘achieve a legitimate aim’.  The guidance states that while costs may be a factor, a hirer will also need to establish that there were practical and organizational considerations.

Agency workers will also have the day one right to be notified of any job vacancies within the hirer that would have been available to a comparable permanent worker.  The guidance says that hirers can choose how to publicise vacancies and the Regulations are not intended to affect the recruitment process or how applications are treated.  The guidance usefully confirms that there is no obligation to inform agency workers where posts have been ring-fenced for redeployment.

The guidance states that a comparator (for the purposes of this right to be notified of vacancies) is a comparable worker at the ‘same establishment’.  This is only right under the Regulations where the comparator must be a person also working at the same establishment.  For other rights, the comparator can work at any establishment provided they carry out a similar role.

After 12 weeks

Once an agency worker has worked for 12 qualifying weeks, they are entitled to additional equal treatment in relation to ‘relevant terms and conditions’.  Namely pay, duration or working time, night work, rest periods, rest breaks, annual leave and paid time off for ante-natal appointments.

Calculating the 12 week qualifying period is not necessarily straight forward.  The guidance provides a lot of detail on this point, but for the purposes of this note we set out the following:

• A week is defined as a calendar week;
• The clock starts ticking the date the assignment starts;
• If an agency worker works for a number of hirers they will have a clock running with each hirer;
• Continuity of time will be broken if there is a break of at least 6 weeks between assignments with the hirer;
• The clock will also restart if the agency worker is moved to a ‘substantially difference role’.

Factors which will determine if a role is substantially difference relate to the skill set required and the nature of the work and duties.  In order to trigger the 12 week qualifying clock to start again on this ground, the hirer must notify the agency that the job duties have changed, and this information must be passed on to the agency worker.

Anti-avoidance provisions address situations where a pattern of assignments emerges that are designed to deliberately deprive an agency worker of their entitlements under the Regulations.  The guidance states that the provisions will only bite if the agency worker has completed ‘at least 2 assignments’ (or 2 roles with the same hirer or connected hirers) and only if the pattern of their assignments was structured with the ‘deliberate intention’ to deprive the worker of equal treatment rights.

The guidance also highlights that an agency worker’s qualifying clock will continue if an agency worker is placed with the same hirer even if they are placed by a different agency.  To mitigate against the risk of agency workers acquiring rights sooner than otherwise expected by the agency, they should ask agency workers to disclose their recent job history.

There are circumstances when the qualifying clock will pause (e.g. if the break in assignments is for less than 6 weeks) and circumstances when it will continue to run (e.g. if an agency worker is pregnant).  When the 12 weeks qualifying period for equal treatment is met, it goes beyond the scope of this article.

Relevant terms and conditions

Once an agency worker has met the 12 weeks qualifying period, they are entitled to equal treatment in terms of relevant terms and conditions.  The guidance suggests that when deciding what ‘equal treatment’ means, it will usually be a matter of ‘common sense’ – the ‘requirement is simply to treat the worker as if he or she has been recruited directly to the same job’.  IN all cases, it is important to ensure that the proper comparison is being made.  The hirer should refer to existing comparable permanent workers terms and conditions, the staff handbook, any collective agreement and / or pay scales, or pay structures that are in place.

The guidance states that pay for these purposes is defined as basic pay plus other contractual entitlements that are ‘directly linked to work done by the agency worker whilst on assignment’.  The entitlement will not extend to occupational sick pay, occupational pensions, occupational maternity, paternity or adoption pay, redundancy pay, notice pay, the majority of benefits in kind, a bonus not linked directly to the contribution of the agency worker etc.

Note – agency workers will be covered by the new automatic pension’s enrolment which will be phased in from October 2012.

There are some exemptions for equal treatment provisions on pay and whether or not an agency worker will be entitled to a bonus will depend on a number of factors which are set out in the guidance.

Contractual holiday provisions over and above the statutory minimum should be provided to agency workers after 12 weeks, but to simplify the administration, the agency may agree to pay the agency worker any accrued but unpaid contractual holiday at the end of the assignment or increase their pay accordingly.

Pregnant agency workers with 12 weeks service in a given job will be allowed paid time off to attend ante-natal medical appointments.  The guidance states that they will also need to be found alternative sources of work and paid at the same rate or higher than the original assignment if they can no longer complete the duties of the original assignment for heath and safety reasons. The pregnant agency worker must notify the agency and the hirer.  The agency should ask the hirer to identify any health and safety risks and make any reasonable adjustments.

Information requests

Day one entitlements are the responsibility of the hirer.  It will be good practice to send the agency and / or the agency worker information on facilities and how vacancies are notified to workers.  Agency workers have the right to request a written statement with all the relevant information relating to rights of a comparable worker and the reasons for the treatment (if different) of agency workers.  The hirer must respond to the agency worker within 28 days.

The agency will initially be responsible for breach of the 12 week equal treatment rights.  However, it will have a defence if it can show that it took ‘reasonable steps’ to obtain relevant information for the hirer about its basic working and employment conditions.  In the first instance, an agency worker can request information from the agency.  If the agency has failed to respond within 10 days, the agency worker can write to the hirer direct.  Information should relate to basic working and employment conditions, factors to be considered when determining basic working and employment conditions and details of the comparable employee (if applicable).

An agency worker can bring a claim to an Employment Tribunal in relation to their rights in the Regulations.  The Employment Tribunal can draw an adverse inference for the fact that a written statement that was requested was not provided.

Note – agencies should still obtain information as set out in The Conduct of Employment Agencies and Employment Businesses Regulations 2003 from the hirer before placing a worker.

Liabilities and Remedies

If an Employment Tribunal upholds an agency workers complaint, it will generally be able to award financial compensation.  This may include loss of earnings and / or compensation for denied access to facilities.  There is no maximum award but there is a minimum award of two weeks pay.

A breach of the anti-avoid provisions could result in a penalty of up to £5,000 against the hirer or the agency, split between the parties in a way that the Employment Tribunal considers just and equitable.

The Tribunal can also make a declaration setting out the agency worker’s rights in relation to the complaint and / or recommend that the hirer / agency takes certain action to remove the adverse effect to the agency worker.

If you have any questions about any of the contents in this article, please contact us on 0845 600 4996.