An outline of the new Agency Worker Regulations

New Employment Law legislation comes into force on October 1 regulating the treatment of agency workers by hiring firms. The Regulations demand hirers give agency workers the same basic employment working conditions as if they had been employed by the business directly.
From day one of an agency workers’ placement a hirer will be required to give workers access to the facilities available to rest of its workers, such as canteens, parking, transport and child care. They will also be required to give them access to information relating to any job vacancies within the company.

If an agency worker remains in the same placement for the same hirer for a period of at least 12 weeks they will qualify for further equal treatment entitlements. This requires hirers to offer agency workers the same employment terms and conditions as regular employees in a similar role. This includes offering the same level of wages, sick pay and holiday entitlement. Part-time agency workers will also qualify for equal treatment entitlement after 12 weeks regardless of how many hours a week they work.

When introduced in October, the legislation will not be retrospective so agency workers who have already been in the same placement for a period of 12 weeks or more will not qualify for the full equal treatment entitlements until 12 weeks from October 1.

Hirers will be required to provide agencies supplying them with workers up-to-date information regarding employment terms and conditions offered to comparable employees so agencies can ensure the workers they supply are afforded the same entitlements.

The legislation identifies a number of situations where workers will be beyond the scope of the Regulations. These include where the worker:

• Has a business to business relationship with the hiring company, i.e. the hiring company is a client. (genuinely self-employed individuals.)
• Is on secondment to the company from another organisation – where the supplying organisation’s main activities are not the supply of temporary workers.
• Is employed by a Managed Service Contract provider – such as a cleaning company – where the contractor is responsible for the day-to-day supervision and instruction of the worker.

In exceptional circumstances the Regulations give hirers the opportunity to objectively justify the less favourable treatment of agency workers. Cost alone will not be sufficient justification for this but practical and organisational implications may be factors that could be taken into account. Hiring firms should also note that the legislation introduces a number of provisions to prevent hirers from circumventing the Regulations:

• Divisions of a company will not be considered separate hirers unless they are separate legal entities, therefore stifling any attempt to prolong the qualifying period by regularly moving agency workers between divisions.
• Paying agency workers through a limited company in an attempt to disguise the relationship as being of a business to business nature will not, on its own, place the worker beyond the scope of the Regulations
• Workers on simultaneous part-time placements with a number of hirers will qualify for equal treatment with each hirer if and when they fulfil each 12 week qualifying period. 
• Workers returning to a previous role with a previous hirer will maintain previously accrued weeks as long as the break from the placement was 6 weeks or less, or 28 weeks or less if the worker is ill.

For a worker to start a new qualifying period they must be hired by a separate legal entity or begin a substantively new role with the current hirer. Whether a role is substantively different will depend on any change in responsibility, pay, required skills and working hours. However, there is nothing in the legislation preventing hirers from only using a worker for 11 weeks and then replacing them.

Any disputes arising over the relationship between a hirer and a worker will be decided by an Employment Tribunal where they will consider whether the arrangements are common within the relevant sector or common for the type of worker/role in question.