The Agency Workers Regulations

July 7, 2010 - PRLog -- The Agency Workers Regulations (AWR) have completed their passage through Parliament and will come into force on 1 October 2011. Details of how the Government intends to proceed with developing guidance on the AWR are yet to be announced.

The main purpose of the AWR is to give temporary agency workers parity in pay and employment conditions with what they would have been entitled to had they been hired directly into the same job.

Under the AWR 'parity' relates only to basic working and employment conditions of temporary agency workers (eg pay, overtime and shift allowances) and does not extend to sick pay and participation in pension schemes.

The AWR does not affect the employment status of temporary agency workers and therefore the AWR does not give the workers rights to claim unfair dismissal or redundancy pay.

The EU's Agency Workers Directive (AWD) was approved by the EU Parliament in October 2008 and was published in its second format in December 2009. The AWD presents a challenge for the recruitment industry and companies alike as it puts temporary agency workers on equal terms with permanent workers with regard to pay and conditions.

It was first drafted in 2000 when Greece (which had virtually outlawed temporary agency working) chaired the principal EU meetings. In previous years, the Directive was debated on and off in the EU, and representations against it were made by UK business organisations to the UK Government and to the European Commission.

The UK will be affected by the Directive more so than any other country in the EU because it has the largest number of temporary agency workers and temporary recruitment agencies than any other EU country. Member countries of the EU are required to implement the AWD by 5th December 2011.

The big question that remains is how the regulations governing the implementation of the AWD will be worded.

Ahead of the Government publishing its official consultation, the REC published the initial findings and recommendations of the Agency Work Commission.

Leading business organisations such as the CBI, FSB, IOD, Professional Contractors Group, CIPD and the British Chambers of Commerce provided input as well as the TUC thoughts from a workers' perspective.

The aim of the Commission was to make practical recommendations on the UK implementation ahead of the Government publishing its official consultation. The current economic climate makes it even more important to get this right first time to ensure that the new regulations do nothing to hinder the creation of job opportunities.

Recommendation 1
The scope of equal treatment should be limited to basic salary and other basic statutory rights

   * A simple definition of what equal treatment covers is essential in order to avoid the kind of uncertainty, bureaucracy and cost that would impact on the viability of agency work in the UK.
   * The definition of pay should be limited to a basic hourly rate. Occupational benefits and financial participation schemes that vary from one user enterprise to another should be excluded.
   * Agency workers are already entitled to the statutory holiday pay which is rising to 28 days.
   * Any extension of holiday pay to equivalents in the user enterprise would add bureaucracy and complexity with agencies having to establish different holiday entitlements for each temporary assignment.

Recommendation 2
Equal treatment must be easy to establish

   * Where no such formal provisions governing pay or working time exist in the user enterprise, it is extremely difficult to find a basis on which equal treatment can be established.
   * The text of the EU Directive does not refer to comparables. Therefore, equal treatment should not be established on the basis of an existing comparable worker, a predecessor to that role or a 'hypothetical' comparable worker.
   * Equal treatment for temporary staff after 12 weeks of an assignment must be established with reference to what they would expect if recruited directly by the employer to occupy the same job.

Recommendation 3
The 12 weeks qualifying period must be easy to administer

   * Ensuring that the 12 weeks period is easy to administer will avoid unnecessary bureaucracy and will limit the number of assignments that are terminated prematurely.
   * There should be recognition for a genuine break between assignments. The Commission recommends that a break of 4 weeks should constitute a legitimate break.
   * Although temporary workers in sectors such as social care and supply teaching may only do one or two days a week, the qualifying period should be 12 calendar weeks regardless of the amount of work carried out during those weeks.
   * The 12 week period should apply to a specific job in a specific location and unit rather than to any role within the user enterprise.

Recommendation 4
Liability must rest with the end user as well as the agency

   * The specific responsibilities of end users and recruitment agencies must be made clear in the regulations.
   * The agency should be expected to take reasonable steps to establish equal treatment but should not be held responsible if that information turns out to be incorrect. There must be an element of compulsion on the user enterprise to provide relevant information to the agency.
   * Liability issues linked to other employment structures such as umbrella companies and master and neutral vendors will need to be considered in detail.

Recommendation 5
Measures to limit the increase in employment tribunals must be promoted

   * Enforcing equal treatment should be through the Employment Tribunal System. However, informal ways of resolving disputes before a case reaches an Employment Tribunal should be encouraged (although the regulations should not be prescriptive on this).
   * The Commission will actively work with ACAS and TUC to propose informal methods of resolving disputes around equal treatment. The key is to provide agencies and employers with a range of options rather than one prescriptive formula.

Recommendation 6
The provision of the directive should be limited to individual workers

   * Professional flexible workers such as interim managers and IT contractors supplied through limited companies/umbrella arrangements are often paid more than permanent workers. They are not the individuals that the legislation is aiming to protect and should be excluded in order to avoid unnecessary bureaucracy for agencies and user enterprises.
   * The Commission proposes that Personal Service Companies be excluded as they are providers of business services and not engaged as workers.
   * The recruitment industry will continue to support initiatives to address instances of bogus self-employment.

Recommendation 7
UK regulations must support legitimate means of derogating from the principle of equal treatment

   * The Commission welcomes the option of being able to form workplace agreements which would avoid the bureaucracy of establishing equal treatment for each assignment.
   * Agencies that employ their temporary workers directly and pay them between assignments should also derogate from the principle of equal treatment.
   * Welfare to Work services should be excluded.

Recommendation 8
A clear communication strategy is essential for effective implementation

   * Proceeding with implementing the Directive without clear communication and understanding will result in confusion and a massive increase in disputes with associated costs for all involved. A comprehensive communication campaign aimed at user enterprises, agencies and job seekers must therefore be a key part of the implementation process.
   * There should be a minimum 12 month lead in time between the regulations being published and formal implementation. This will allow for the publication of guidance and the necessary systems to be put in place and end users to be reassured about the application of the Directive.

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