background to the draft agency workers regulations
The Agency Workers Directive (AWD) was adopted on 19 November 2008 and needs to be implemented in the UK by 1 October 2011. The aim of the AWD is to ensure the protection of agency workers by ensuring they have the benefit of the same basic working and employment conditions as if they had been directly employed by the end user.
The Directive was adopted after the UK dropped its opposition to the measure as a result of an agreement between the CBI and the TUC reached in May 2008, which broadly set out the terms on which the Directive would be implemented in the UK. The key feature of the agreement was that the right to equality should apply only once an agency worker has been engaged for 12 weeks 'in a given job'.
The draft Regulations specify they will come into force on 1 October 2011. At the moment, there are a number of 'grey' areas and an update is awaited from the current coalition government. However, the core concepts underlying the test of equal treatment and parity of pay are unlikely to change.
the purpose of the agency workers regulations (AWR)
The Regulations are mainly concerned with giving agency workers the right to the same basic employment and working conditions they would have enjoyed had they been directly employed by the end user.
Under the AWR an agency worker is defined as a person who has a contract with a temporary work agency and who is supplied work under the supervision and control of a client or hirer. It will include those employed via umbrella companies. Workers who are genuinely employed on their own account will be excluded (self-employed).
relevant terms and conditions
The right to equality does not apply to all terms and conditions of employment: only “relevant” terms and conditions. These will include (but not be limited to) such matters as:
- duration of working time
- overtime
- breaks
- rest periods
- night work
- holidays
- public holidays
- pay (including local bonuses which are directly linked to output or quality of work)
- terms and conditions ordinarily included in employee contracts (for example, collective agreements, pay scales, company handbooks)
- other matters of custom and practice in the workplace (for example, access to facilities and permanent employment with the hirer).
what is excluded
Some payments are excluded from the definition of pay. These are:
- occupational sick pay
- any sums relating to pension, retirement or compensation for loss of office
- payment in respect of maternity, paternity or adoption leave
- redundancy payments
- payments made under a financial participation scheme
- any payment or reward made by way of a bonus awarded in accordance with a performance appraisal pay system aimed at the long-term management, motivation and retention of staff (although bonuses that are not part of such a system are covered by the definition of pay).
the qualifying period for agency workers
The Directive provided for agency workers to be entitled to equality from day one of any assignment. However, the agreement between the TUC and the CBI on the interpretation of the Directive provides for equality of treatment only after 12 weeks “in a given job”.
To complete the qualifying period, an agency worker must be engaged in the same role with the same hirer for 12 continuous calendar weeks. Once the worker has completed the 12-week qualifying period, the worker will be entitled to equal treatment as long as he or she continues in the same role.
For each week that the agency worker is engaged by the agency, he or she will be taken to be in the same role unless engaged on a new assignment. In order to break the continuity of the qualifying period, any change of role must demonstrate that it “comprises substantively different work or duties” to the previous assignment.
breaks between assignment and anti-avoidance
The Regulations state that in relation to the 12 week qualifying period, in general, a break of six weeks or longer between two assignments shall have the effect of breaking continuity.
The Regulations make provision to prevent artificial manipulation of working patterns with a view to preventing a worker from qualifying for equal treatment.
An award of £5,000 can be made to the worker if anti-avoidance measures are proved. The minimum amount of compensation is 2 weeks' pay.
day one rights for agency workers
The draft AWR gives agency workers some rights from the first day of each assignment. An agency worker has the right to be treated no less favourably than a comparable employee in the hirer's establishment in relation to:
- access to permanent vacancies
- access to canteen or other similar facilities
- access to childcare facilities; and
- the provision of transport service.
However, the hirer has the option of showing that denying access to agency workers is justified on objective grounds. In practice, it is not expected that this provision will cause hirers too much difficulty.
liability of agencies and hirers
Perhaps the most fundamental difficulty in enforcing the rights of agency workers will be ascertaining who, in the chain of relationships will be liable for a breach of the AWR.
Under the current draft of the regulations, any entity in the chain of relationships could be liable but only to the extent that they caused the breach. As such, it will be important that hirers make the necessary information available to agencies so that they can identify the appropriate rate of pay (and other benefits) to which the worker will be entitled.
what Randstad is doing to support their clients
The Randstad board of directors is working with the Recruitment & Employment Confederation (REC) to lobby the UK government.
We continue to consult legally and with our industry experts.
A Randstad, UK wide, project team was formed at the beginning of the year. The aim of which is to offer direction on the implementation of the Regulations together with providing options for our clients.
We continue to work with our clients to provide the right solution aligned to organisational planning.
National and local client seminars are planned to enable clients to become more aware of the implications of the Agency Worker Regulations, how they might affect them, but most importantly, to present clients with what Randstad considers to be the best options or approaches to help us to work within this new legal framework and which will be best suited to our clients' and our workers' needs.
Please note that information contained in this document is based on the regulations as drafted under the previous government and are subject to change by the coalition government.