Those companies that regularly engage agency workers should take note of the changes being made to agency workers rights through The Agency Workers Regulations 2010, due to come into force in October 2011. The Regulations have been issued in advance to allow businesses time to adjust their working practices.
The Regulations will apply to agency workers that are recruited through an agency and those persons contracted through an umbrella company.
The Regulations endeavour to introduce equal treatment for agency workers once they have been engaged on an assignment by a hirer for a continuous period of at least 12 weeks.
The aim of the Regulations is to ensure that agency workers receive the same pay, benefits and treatment as those permanent employees engaged by a hirer doing like work.
The 12 week qualifying period relates to the period of time during which the agency worker has undertaken the same role with the same hirer for a continuous period of 12 weeks. Any week during which the agency worker is engaged on an assignment, be it part of or the whole of a week is counted as a calendar week. Therefore an agency worker can be engaged for 1 day a week for 12 weeks and qualify for equal treatment as permanent members of staff as long as they have been engaged on the same/similar assignment throughout the 12 week period.
A hiring company can potentially reduce the impact of the Regulations if they restrict their agency workers to 12 week assignments. This can be onerous on a hirer if they continually have to re-train and re-engage staff. Any hirers looking to circumnavigate the Regulations must note that there has to be a minimum break of 6 weeks between assignments for the 12 week period to be reset.
If a ‘structure of assignments develops’ which is designed to move an agency worker from assignment to assignment during, for example, the 11th week, grounds for a claim against the hirer may arise. Any hirer looking to develop a distinctive working pattern for the agency worker should be warned that tribunals will have the power to make an additional award of £5,000 in respect of these claims.
Under the Regulations any agency worker that has completed their 12 week qualifying period will be entitled to the same rate of pay as a permanent employee, including benefits, relating to the actual work being done. An agency worker, after 12 weeks, will be entitled to pay, contractual holiday entitlement, overtime, luncheon vouchers, shift allowances and even bonuses relating to short-term targets. Agency workers will not be entitled to equivalent treatment in relation to share schemes, occupational pension schemes, sick pay, contractual notice, contractual redundancy pay, contractual maternity/paternity rights or any bonus schemes designed to reward long-term service. Any hirer should be aware that the Regulations will also extend equal treatment to include access to facilities such as childcare, canteens and transport.
So, on a practical level, a hiring company engaging an agency worker on an assignment expected to last 12 weeks or more should identify the rate of pay a permanent employee would be paid and relay this information to the relevant agency.
The increased costs of equal treatment are likely to have to be absorbed by the hiring company but, if an agency worker does not receive equal treatment, the agency will be liable, unless they can show that the hirer provided them with inaccurate information.
The Regulations are clearly designed to protect agency workers from exploitation but the increased costs for hirers will have an impact on their profitability. Companies that regularly engage agency workers will now have to rethink their strategies when it comes to non-permanent staff and consider whether they wish to continue taking on agency staff.
On this basis it is essential that companies that use agency workers on a regular basis and wish to continue doing so carefully review their agency agreements. It is worthwhile for hirers to insert specific provisions into their agency agreements which apportion any liability that may flow from a breach of these Regulations. Many people question whether the implementation of these Regulations will have a catastrophic effect on those recruitment agencies that specialise in placing agency staff.
If you would like more information then please visit the Employment Section of our website or contact Elizabeth McGlone
