On the 1st of October 2011 the Agency Workers Regulations will come in to force in the UK, giving more employment rights to agency workers and potentially affecting any business which hires them.
The regulations have been introduced in response to the Temporary Agency Workers Directive which all EU member states are required to incorporate. The key requirements of the Directive are:
The provision of basic working and employment conditions for assigned temporary workers that are no less favourable than if they had been recruited direct by the hirer. This covers remuneration, paid holiday, working hours, overtime, maternity and anti-discrimination provisions and, arguably, pension contributions. The UK government and other related bodies have agreed that there should be a 12-week qualifying period for this right.
Equal access for temporary workers to employment, collective facilities and vocational training.
Penalties for non-compliance by temporary work agencies and hirers.
What is an agency worker?
An agency worker is often referred to as a temp. They are signed up to an “employment business” and then work for one or more of the employment business' clients. The work may be short term, fixed term or for longer periods of time depending on requirement.
What are the most critical changes brought in by the new regulations?
From October 1st agency workers will now have:
The right to the same pay and other "basic working and employment conditions" as equivalent to permanent staff, as if they had been recruited directly by the hirer after a 12-week qualifying period.
Access to collective facilities and to information about employment vacancies from day 1 of their assignment. Examples of collective facilities are: A canteen or other similar facilities, a workplace crèche, transport services (in this context, local pick up and drop offs, transport between sites; not company car allowances or season ticket loans), toilet/shower facilities, staff common room, waiting room, mother and baby room, prayer room, food and drinks machines, car parking
Are the regulations retrospective?
The Regulations are not retrospective therefore agency workers already on assignment on 1 October 2011 will start to accrue their 12-week qualifying period from that date.
How do I calculate the 12 week qualifying period if an agency worker starts their assignment mid-week or if they are only doing part time hours?
The 12 week qualifying period is calculated on calendar weeks so if someone starts an assignment mid week then the following 7 days will constitute 1 week. There is no separate provision for part time workers.
Can I let an agency worker go before their 12 week qualifying period and then re-hire them immediately?
No. If:
the agency worker remains with the same hirer but starts a new, substantively different role; or
the agency worker starts a new assignment with a new hirer; or
there is a break of more than six calendar weeks between assignments the agency worker undertakes with the same hirer.
Then the 12 week qualifying period is considered to have been broken. However, continuity will not be broken but weeks will not count (that is, the clock is paused) where they consist of:
a break for any reason which is not more than six calendar weeks,
a break of up to 28 weeks because the agency worker is incapable of work because of sickness or injury,
any break which is for the purpose of taking leave, including annual leave, to which the agency worker is entitled,
a break of up to 28 weeks to allow the agency worker to perform jury service,
a break caused by a planned shutdown of the workplace by the hirer (for example, at Christmas), or
a break caused by a strike, lock out or other industrial action at the hirer's establishment.
Continuity will also remain unbroken due to:
pregnancy, childbirth or maternity which take place either during pregnancy and for up to 26 weeks after childbirth, or
the agency worker taking maternity, adoption or paternity leave.
If we operate an annual appraisal system does this mean I have to include the agency workers as well?
No, the regulations do not require that. Although, it is advisable to consider implementing a shorter and/or modified process in place in order to track the performance of your agency workers.
Will Agency workers who have reached their qualifying period be eligible for the Company bonus scheme?
Yes, under certain circumstances. The regulations state that if the bonus scheme in part or in whole is “directly attributable to the amount and quality of the work” then the agency worker may be eligible for it. This will include performance bonuses attributable to personal target achievement as well as commission structures. If a bonus scheme requires certain criteria to be met in order to be eligible for it, such as a 12 month qualifying period, then the agency worker will be calculated from the day they started working for the company. Agency workers are not eligible for Bonuses which are not dependent on individual performance. Note, an agency worker does not have to be awarded the same bonus as a similar employee but they do have to be eligible for it.
Our company offers longer breaks than required by law and/or enhanced holiday, is the agency worker eligible for this too?
As long as the agency worker has completed their 12 week qualifying period then they are entitled to the same rest breaks and holiday as a comparable employee. If the company offers greater than the statute then the agency worker will also receive greater than the statute. Whilst the regulations do not cover payment in lieu, it is acceptable under the working time regulations act and therefore it may be worth considering making a payment in lieu at the end of assignment.
What if an agency worker becomes pregnant whilst on assignment to our company?
If the agency worker has completed their 12 week qualifying period then they will be entitled to paid time off to attend ante-natal appointments. The agency worker will have to inform the hirer and the agency that she is pregnant, in writing if requested. Where asked by the company and/or the agency, she will also have to provide written evidence of ante-natal appointments (unless it is the first appointment).
Subject to a 12-week qualifying period, the agency worker will be entitled to be paid by the TWA during her absence at the appropriate hourly rate
Subject to a 12-week qualifying period, an agency worker can bring a tribunal claim if she is unreasonably refused time off or is not paid during her absence.
The company must pay the agency worker for each hour she misses of her assignment and that it will be reasonable to ask her to give an estimate of how long an appointment will last and how long it will then take her to get to work. It is noted that clinics are busy, patients are not always seen on time and that the agency worker will be entitled to be paid for the entire appointment including the time it takes to get to and from the appointment if it is during assignment hours. The Guidance also notes that advice to individuals is to try to avoid taking time off work where appointments can be reasonably arranged outside working hours.
In taking the approach that ante-natal care includes relaxation or parent craft classes as well as medical examinations, the guidance is consistent with previous government advice.
What if the role the agency worker was hired for is not suitable during pregnancy?
The company will be under a duty to make adjustments to protect agency workers from identified risks if they are pregnant, have recently given birth or are breastfeeding. Where this is not reasonable, or will not remove the risk, the hirer should let the agency know, the agency will have to stop supplying the worker to the hirer for that position and the agency will have to offer appropriate alternative work on terms (including pay) which are not substantially less favourable than the original assignment. The obligation to find a suitable alternative lasts for the duration (or expected duration) of the original assignment.
What steps should we take when the act comes into force?
Carry out an audit of agency staff engaged in the company, including what basic terms they receive and how these terms compare with equivalent employees. Are they supplied by one agency or a number of agencies or through an umbrella company?
Create skills matrices for each of the roles that agency workers and employees are assigned to carry out, to enable a proper comparison of the roles. This will help assess whether the agency workers have an appropriate comparator for the purposes of the Regulations, and, if not, determine whether it is necessary to provide the same basic working and employment conditions.
Provide agencies with copies of standard terms and conditions of employment, pay scales and annual leave entitlements of comparable workers.
Establish a mechanism to keep track of agency workers so that the qualifying period can be calculated correctly.
Subject to the anti-avoidance provisions, consider engaging workers on short assignments (of no more than 12 weeks) and replacing them with different agency workers. However, the cost implications of induction and a lack of continuity may make this unattractive.
Identify roles for which there is no directly recruited comparator (and to which the equal treatment provisions would, therefore, not apply). However, there is a risk that a tribunal would disagree that no comparator exists for a particular agency worker role..
In conclusion, the introduction of the act does not mean that agency workers will now have full employment rights but their rights have changed and companies must prepare themselves accordingly. Failure to do so may allow agency workers to pursue companies through the employment tribunal system if they feel that their rights have been breached.
For more information or to order a bespoke agency workers directive policy for your company please contact Nigel Sellens (nigel.sellens@harbourhr.com or +44 (0)20 7152 1104) for more details
