Agency Workers Regulations
Are Agency Workers Loosing their Appeal?

The Government has published detailed guidance on the Agency Workers Regulations 2010 ("the Regulations") which are due to become law on 1st October 2011.

During the recession many employers have taken advantage of the greater flexibility and cheaper costs associated with agency workers on short term temporary contracts. After the Agency Workers Regulations become law in October, agency workers, or at least those who are going to be retained for longer than 12 weeks, might not seem such an attractive option.

The Regulations will provide that those workers who have been retained for longer than 12 weeks will be entitled to the same working and employment conditions as a full time employee who  undertaking the same role. Ensuring this parity is likely to increase the cost of agency workers to employers.

We have all been anticipating that the implementation of the Regulations will also throw up a lot of practical issues and questions. For instance, employers may wish to consider  HR systems  to ensure that they are aware of the approach of the 12 week period . Many have wondered whether there would be any legal implications for those hiring the agents and/or the agencies if they rotate temporary workers on the eve of the 12 week period so as to avoid liability. In other words, will the Regulations have real "bite". The guidance issued by the government gives some answers.

Inform the Agency Worker of any Vacant Posts

It is now clear that an agency worker will have the right during an assignment to be informed by the hirer of any relevant vacant posts with the hirer so as to the give that agency worker the same opportunity as a comparable worker to find permanent employment with the hirer. This is comparable to the duty to advise potentially redundancy employees of any suitable vacancies.

Watch Out for Regulation 14

There is also the question of who is going to be liable for any breach of the Regulations. Regulation 14 states that the agency will only be liable up to the extent that it is responsible for that breach. Subject to that, in most cases, liability is going to fall on the shoulders of the hirer. An agency worker may bring a claim for unfair dismissal if they are dismissed for the purposes of evading liability under the legislation so this will prevent the practice  of deliberately terminating and hiring a different agency worker on the eve of the 12 week deadline.

Calculate the Qualifying Period Correctly

It is also worth noting that in calculating the 12 week qualifying period, breaks between assignments or during an assignment will not break continuity if they are not for more than 6 weeks or for a number of specified reasons (sickness, injury, pregnancy, childbirth, maternity, adoption or paternity leave).

Clearly the Regulations are going to have considerable bite and correspondingly great financial impact on those that regularly use agency workers and also result in an increased bureaucratic burden. The anti-avoidance provisions that are built in are formidable and could result in costly tribunal claims for those that fail to understand it's implications. Many employers may wish to consider alternatives to using agency workers. They are not as attractive an option as they were previously.

For more information on contracts of employment and the effects of particular clauses, or for advice on any other employment issue please contact our employment department on 020 7354 3000 or e-mail employment@colmancoyle.com

Author: David Malamatenios, Partner

Date Published : 14/07/2011