Agency Workers Regulations

Overview of the Regulations

The Agency Workers Regulations, “AWR”, came into force on 1 October 2011 and implemented the 2008 EU temporary agency work directive in the UK. They gave both full and part-time temporary agency workers the same basic rights as those on permanent contracts of employment in a comparable role.

Equal treatment, after the initial qualifying period of twelve weeks in the same assignment, covers pay and working conditions including overtime, breaks, rest periods and annual leave.

This is in addition to the basic rights awarded to all agency workers regardless of circumstance. Such rights extend from entitlement to the National Minimum Wage and Statutory Sick Pay, to access to shared facilities and freedom from discrimination under equality legislation.

In HMRC’s own words:

‘An agency worker (A) shall be entitled to the same basic working and employment conditions as A would be entitled to for doing the same job had A been recruited by the hirer.’

The regulations also forbid recruitment agencies from charging fees to prospective workers for searching for or finding them suitable employment.

 The Qualifying Period

The qualifying period can be either extended (‘paused’) or reset to zero in certain circumstances, delaying the date at which equal treatment must begin. A break of six weeks or less within the same role can constitute a pause, however any longer (except for maternity/paternity leave or due to sickness or injury) renders any previous time that counted towards the qualifying period obsolete.

Similarly, the period reverts to zero if an agency worker moves to a new assignment with a new hirer, or if they remain with the same hirer but take on a ‘substantially different’ role requiring alternate skills, training or a change in working hours.

Permanent Contract of Employment

An agency may offer permanent contracts of employment, entitling workers to pay between jobs or assignments. Such workers are employees of the agency and do not qualify for equal pay, however they are entitled to all other specified terms following the twelve week qualifying period.

If an agency wishes to terminate the contract then it is liable for four weeks’ pay between assignments and the worker may be subject to both notice and redundancy pay.

This contrasts with a worker placed in a permanent position within a company. In this instance the employment contract is likely to be with the hiring company itself rather than the agency, and as such, workers should have the same rights as the other permanent employees. Essentially, there should be no distinction between the two. 

‘Workers’ as opposed to ‘Employees’

Temporary agency workers are not entitled to redundancy pay or to claim unfair dismissal. Such rights are reserved for ‘employees’ rather than ‘workers’ as made clear within the legislation.

Compliant Solution

Professional contractors engaged through Smart Pay will be exempt from the AWR.