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Frettens Update: Employment Law Q & A – Agency Worker Regulations

  25th August 2011      
 Company News, Employment Law

This month’s Q&A focuses on the key points of the Agency Workers Regulations 2010 (“the Regulations”), which are due to come into effect on 1 October 2011.

Q  In brief, what is the purpose of the Regulations?
A  The Regulations will apply whenever an agency worker is assigned to undertake temporary work for a hirer through a temporary work agency. They are designed to ensure that agency workers are given equal treatment with the hiring employer’s permanent staff, in terms of both access to certain facilities of the hirer and in relation to certain terms and conditions of employment, including pay and holiday entitlement. Some of the rights apply from the very first day of an agency worker’s assignment, and the remainder after the completion of a 12-week qualifying period.

Q What rights do temporary agency workers have under the Regulations from the beginning of an assignment?
A The Regulations afford temporary agency workers with two rights from the very first day that the agency worker begins an assignment for a hirer — the ‘day one rights’:

-The right to the same access to the hirer’s ‘collective facilities and amenities’ as the hirer’s permanent employees. ‘Collective facilities and amenities’ are intended to be the sorts of facilities and amenities that are offered collectively to all or part of the hirer’s permanent employees (as opposed to particular benefits offered only to certain individuals). Examples include a staff canteen, crèche or car parking facility; but exclude accessing off-site facilities that are not provided by the hirer itself, such as membership of an off-site gym operated by a third party.
-Save in circumstances where there is a headcount freeze (e.g. due to a redundancy or re-structuring exercise), the right to be provided with the same access to information relating to the hirer’s job vacancies as the hirer’s permanent staff .
Q What rights do temporary agency workers acquire under the Regulations after the 12-week qualifying period?
A Once an agency worker has undertaken the same role, for the same hirer, for 12 continuous weeks, the agency worker is then entitled to the same ‘basic working and employment conditions’ to which they would have been entitled had they been directly employed by the hirer.

The meaning of ‘basic working and employment conditions’ is restricted to conditions relating to pay; the duration of working time; night work; rest periods and rest breaks; and annual leave.

The difficult area relates to exactly what constitutes pay, and in particular whether or not a hirer’s bonus scheme falls into the definition of ‘pay’ for the purposes of the Regulations. Only bonuses or commission payments that are directly referable to the amount or quality of an individual’s work are included. Careful consideration will therefore need to be given to the type of bonus scheme(s) that the hirer operates in relation to its permanent staff, particularly where these are subject to both individual and organisation wide performance criteria, in order to understand if such bonuses need to be provided to agency workers.

Q How is the 12-week qualifying period calculated?
A In acknowledging the irregular working patterns typically worked by agency workers, the Regulations provide for a number of circumstances in which breaks in assignments will not break the continuity of an assignment for the purposes of acquiring the requisite 12 continuous weeks qualifying period. This includes any break of less than 6 weeks.

Therefore, in the event of a break in an assignment, employers should check the Regulations carefully to determine whether or not that break stops the clock running altogether in relation to the accrual of the qualifying period, or whether it merely pauses it until the agency worker resumes work for the hirer.

Q Can a hirer engage temporary agency workers for less than 12-weeks in order to avoid them qualifying for the right to equal treatment in terms of pay and conditions?
A While there is nothing to stop a hirer having a policy of only hiring temporary agency workers for less than 12-weeks, the Regulations do contain anti-avoidance provisions. These prevent a hirer from developing a practice of hiring agency workers on the basis of a repeated pattern of assignments lasting less than 12-weeks each, with breaks in between, in order to deliberately avoid the right to equal pay and conditions arising. In such circumstances, the Regulations will deem that an agency worker who has worked a total of 12 weeks is entitled to equal treatment with the hirer’s permanent staff in terms of pay and conditions

Q Who is responsible for providing the temporary agency worker with equivalent terms to the hirer’s permanent staff?
A While it is the agency that is responsible for providing equal terms to the temporary agency worker, it can only do so if the hirer provides the agency with the correct information about the terms and conditions of its comparable permanent staff. It is also the case that in practical terms the hirer will bear the cost of giving the agency worker equivalent terms, as it will no doubt be reflected in the rate that it has to pay to the agency for the agency worker concerned.

Q Are there any other rights that temporary agency workers are afforded under the Regulations?
A Pregnant temporary agency workers have the right to be paid by the agency even if they cannot carry out the assignment, or any alternative work, on health and safety grounds; and once they have completed the 12-week qualifying period, pregnant agency workers have a right to paid time off to attend ante-natal appointments and classes. In addition, all temporary agency workers have the right to make a written request for relevant information from the agency and/or the hirer as appropriate, in order to ascertain if any of their entitlements under the Regulations are being infringed.

Q Who is liable for breaches of an agency worker’s rights under the Regulations?
A The hirer is solely responsible for any breaches of the ‘day one rights’ as these are in the sole control of, and can only be provided by, the hirer. However liability for failing to provide the agency worker with ‘basic working and employment conditions’ equal to those of the hirer’s permanent staff, can rest with either the hirer or the temporary worker agency, depending upon the extent of each party’s responsibility for the breach in question. As a temporary worker agency is responsible for providing the agency worker with comparable conditions to the hirer’s permanent staff, it will usually be liable for any breach. However, if that breach arises from the hirer’s failure to inform the agency of the relevant terms of its permanent staff, the hirer is likely to find itself liable for the breach.

Q What is the penalty for agencies or hirers who are in breach of their obligations under the Regulations?
A A temporary agency worker whose rights have been infringed under the Regulations will be able to bring a claim in the Employment Tribunal against the agency and/or the hirer as appropriate for a declaration of their rights and for compensation. While there is a minimum compensatory award of two weeks’ pay, there is no maximum limit on the amount that can be awarded.

Q So what should hirers do to ensure that they comply with their obligations towards temporary agency workers under the Regulations?
A In order to comply with the Regulations, all hirers of temporary agency workers should ensure that they:

1.Provide to the temporary worker agency they are contracting with, up to date information as to the terms and conditions of employment normally provided to their permanent staff, in order that the agency can ensure that the agency worker receives equal terms and conditions; and
2.Ensure that from the very first day of their assignment, all agency workers are informed of, and are provided access to, (a) all of the hirer’s staff facilities and amenities; and (b) information on any job vacancies within the hirer.

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