On 1 October 2011 the Agency Workers Regulations 2010 (‘the Regulations’) will come into force in England, Scotland and Wales (with similar provisions for Northern Ireland from 1 December 2011). Many businesses, especially those in the hospitality and catering sectors which often rely on access to a flexible workforce, will feel the potentially huge impact of the Regulations from October.
The Regulations provide that agency workers (i.e. temps) will be entitled to equal treatment with permanent employees and workers after 12 weeks in a given job, as well as acquiring some additional rights from day one of their assignment. Failure to comply with the Regulations will render both the temporary work agency supplying the worker, and the hiring company, liable for compensatory awards including anti-avoidance penalties of up to £5,000 per worker.
The rights
The Regulations give some rights to temps immediately on the commencement of their assignment, known as ‘day one’ rights. Temps will have the same access as permanent staff to:
– collective facilities e.g. canteens, childcare facilities, transport services, car parking; and
– permanent employment, i.e. the right to be informed of any relevant vacancies.
After 12 weeks on an assignment, temps will also acquire the right to equal treatment in respect of basic working and employment conditions as if they had been recruited directly by the hirer. This will include the right to equal treatment with permanent staff in respect of pay, working time, holidays and rest periods and protection during pregnancy including paid time off for ante-natal appointments.
The definition of ‘pay’ is a wide one, with specific exclusions for such elements as pension, sick pay and maternity pay. However, there is likely to be debate on this issue; for example, performance related bonuses are included in ‘pay’ but difficulties will arise where there are mixed personal and company performance bonuses.
The qualifying period
Whether a temp has spent 12 weeks in a given job will be one of the main practical issues for businesses to deal with. The Regulations provide that for the purpose of counting the 12 week qualifying period, an agency worker is deemed to be in the same role unless they have started a ‘substantively different’ new role with the hirer and they have been informed of this in writing.
Emphasis is placed on the nature of the role, and factors which might be considered when assessing whether a new role is substantively different are the skills and competences required, pay, location and management, working hours, and the need for further training.
The qualifying period requires an agency worker to work for 12 continuous calendar weeks, but note that even temporary work of one day per week will still count as a ‘calendar week’ for this purpose. In addition, for some absences the qualifying period can be suspended, for example, during holidays and sickness, and the agency worker can restart the clock from where they left it before such absence. The 12 week period can also be reached in certain circumstances even when the worker is absent from work, primarily when they are absent on maternity, paternity or adoption leave.
Liability
Temps can bring claims where they have been denied their rights under the Regulations or where they believe the hirer or agency has breached the anti-avoidance provisions. In order to establish a claim, temps may request information from the agency, or failing a response, from the hirer to determine whether they are receiving equal treatment.
Both the agency and the hirer are potentially liable for breaches of rights under the Regulations. However, the agency will have a defence where it can show that it took ‘reasonable steps’ to obtain information about basic working and employment conditions from the hirer and acted reasonably in determining the temp’s conditions. The hirer will then be responsible for any breach of the Regulations and, in any event, has complete responsibility for the ‘day one’ rights.
In addition to compensatory awards being brought against the agency and potentially the hirer for loss of pay and benefits, the Regulations contain detailed anti-avoidance provisions to prevent workers being moved around a business to prevent them falling under their scope. Breach of such provisions can be punished with an additional award of up to £5,000.
What you need to do
Hirers should now be assessing their use of temps and the benefits which their temps are currently receiving (or not). Dialogue with agencies should be entered into to consider how the exchange of information will be dealt with and to negotiate the additional costs flowing from the Regulations.
From 1 October, hirers will need to ensure they carefully track and monitor their usage of temps so they know if and when any individual satisfies the qualifying period.
The additional cost of monitoring and complying with the Regulations may force some businesses into a strategic rethink of their personnel needs. At the very least, with less than six months until the Regulations come into force, hirers must ensure they are fully up to speed with their provisions and the accompanying guidance.
The information contained in this article is intended to be a synopsis only. Before acting on it, you should take professional advice.
Written by Lisa Jinks, Associate and Oliver Worth, Trainee Solicitor
Employment & Employee Benefits
Greenwoods Solicitors LLP
Monkstone House
City Road
Peterborough PE1 1JE.
Tel: 01733 887700
Website: www.greenwoods.co.uk
Greenwoods and Hospitality and catering News welcome feedback and comment on articles, and suggestions for future articles. Please email rcrowley@einsidetrack.com in the first instance: all emails will be acknowledged.
April 2011