October brings new rights for agency workers

The Agency Workers Directive will be implemented in full on 1 October 2011 after much delay and a considerable amount of controversy about the effect the legislation will have on business.

The new regulations will give temporary agency workers parity in pay and employment conditions with those workers employed by the hirer directly to do the same job. In order to qualify, the agency worker must have been engaged for twelve weeks with the same hirer and in the same role.

Agency workers will not be given the rights to claim unfair dismissal, redundancy pay or maternity leave. Certain occupational benefits such as contractual sick pay, maternity and paternity pay, pensions and some bonuses are specifically excluded by paragraph 6.3 of the regulations.

An agency worker is defined in the directive as someone who:

• is supplied by a temporary work agency to work temporarily for and under the supervision and direction of a hirer; and
• has a contract with the temporary work agency which is;
        a) a contract of employment; or
        b) a contract to perform work and services personally for the agency.

Agency workers will be entitled to some benefits from day one of an assignment. These include being made aware of job vacancies in the organisation and access to collective workplace facilities such as childcare provision, catering and workplace transport. However, some amenities which presume a longer term relationship will not be included, such as season ticket loans, a subsidised gym membership or childcare vouchers.

After twelve weeks agency workers will then be entitled to the same basic pay and working conditions as other employees. Pay is defined in the regulations as follows.

"Any sums payable to a worker of the hirer in connection with the worker's employment, including any fee, bonus, commission, holiday pay or other emolument referable to the employment, whether payable under contract or otherwise but excluding any payments or rewards within Regulation 6.3".

Therefore 'pay' includes the basic hourly rate and linked entitlements, overtime, shift allowances, unsocial hours premiums, payments for difficult or dangerous duties and lunch vouchers. Bonuses which are earned as a result of the work done by an agency worker will also be included.

Agency workers will also have the right to the same rest breaks and pro-rata annual leave as other employees, as set out in the Working Time Regulations.

A new twelve week qualifying period can begin if there is a six week break in service or the worker is retained by the hirer but assigned to a substantially different role. The qualification period can be paused if the worker takes annual leave, sick leave or time off to undertake a public duty.

In order to prevent employers from circumventing the rules on qualifying time, stringent anti-avoidance measures have been put in place. These include prohibiting the rotation of agency workers between substantially different assignments and prohibiting the engagement of workers on a series of eleven week assignments with a six week break between them.

In the event of a claim, liability will rest with the hirer if there is a failure to deliver those entitlements that are due from day one. The liability for failing to give parity in basic pay and conditions can rest with the Agency, the hirer or both. The Agency may have a legal defence if it can show that it took reasonable steps to obtain relevant information from the hirer about its basic working and employment conditions and treated the worker correctly. In that case the hirer will bear all of the liability. If liability remains unclear then a worker can bring a claim against both parties at the outset and the tribunal will decide to what extent each party is responsible for the infringement.

Where agencies give their workers employment contracts and pay them between assignments they will not need to prove equal treatment when those workers are placed with a hirer. Although there are separate rules that the agency must comply with regarding pay and termination of the contract.

If a tribunal upholds an agency worker's complaint then there could be several outcomes. There would generally be some financial compensation but there could also be financial penalties imposed on the agency or hirer in some circumstances. The tribunal may also make a declaration setting out the worker's rights or recommend that certain actions are taken to deal with the adverse effect on the agency worker.

UK Training presents a comprehensive one-day seminar, The Essentials of Employment Law, which covers the essential statutory duties with which an employer must comply. It has now been updated to include the Agency Workers Directive - full details can be found here.