Agency workers – the new rights

Els Janssens and Michal SteinJune 2011

Agency Workers Regulations 2010

• 1 October 2011

• TUC, CBI and government agreement

• BIS Guidance

• Retain flexibility / ensure equality?

• Not retrospective

Scope of the Regulations

• Supply by agency to hirer – triangular relationship

• Employee / worker

• Other forms of engagement

Equal treatment principle

• Entitlement to the same basic working and employment conditions

• As if recruited by the hirer directly

• After the 12 week qualifying period

How far does the equal treatment principle go?

• What are the basic working and employment conditions…?– Pay– Working time– Night work– Rest periods and breaks– Annual leave

• …Which would be “ordinarily included” in direct employment?

– Pay scale / pay structures / going rate– Terms in a collective agreement or company handbook– Standard contractual conditions e.g. holiday

• When is this assessed?

What is pay?

• Basic pay• Overtime (if they qualify) and shift allowances • Holiday pay• Bonus and commission…

– …If it is directly attributable to the individual’s work• Regular payments as a matter of custom and practice• Vouchers with monetary value (e.g. childcare)

What is not “pay”?

• Occupational sick, maternity, paternity or adoption pay• All redundancy pay• Notice pay• Occupational pensions

– But watch out for the auto-enrolment rules from October 2012!

• Pay linked to share schemes or other financial participation schemes

• Guarantee pay

• Loans• Expenses• Paid time off for union duties• Bonuses or rewards not linked to work done (see below)• Discretionary bonuses• Benefits in kind which do not have fixed monetary value or are

given to reward loyalty

Key grey areas

• Bonus– If it is directly attributable to the individual’s work

– Commssion linked to sales?– Success fees?

– Not if purely linked to company performance – For long term service or loyalty

– Hybrid?– Pro-rata?– Appraisals and assessments?

• Holiday– Pay in lieu of contractual holiday in excess of statutory

– One off or rolled into hourly / daily rate

12 Week Qualifying Period

• In the same role• With the same hirer• For 12 continuous calendar weeks

• Breaking continuity:– Is the role substantively different? and– Did the agency confirm the new role in writing? and– Is the new role with a different hirer?

– Was a break actually just a “pause”? – (e.g. up to six weeks’ break, sick leave, annual leave, etc)

– Was the clock actually ticking during a break? – (e.g. maternity related absence)

Anti-avoidance

• Is there a “structure of assignments” which thwarts the 12 week qualifying period?

– Has the worker:– completed two or more assignments with a particular

hirer or connected hirers, or– Worked in two or more substantively different roles with

the same hirer? and– Is the most likely explanation that the hirer or agency

intended to prevent the worker from becoming entitled to equal treatment? and

– Would the worker have been entitled to equal treatment if the structure didn’t exist?

Enforcement

• Liability for breach of equality duty can lie with the agency and / or hirer– Did the Agency take reasonable steps to get information from the

hirer?– Compensation for loss

• Anti-avoidance– Additional award of up to £5,000 – Apportioned between hirer and agency

• Obligation to give information to workers on request– Adverse inferences

• (Information obligations in certain collective bargaining situations)

Defence and exception

• “Deemed compliance” defence– Find an actual comparator:

– An employee of the hirer at the time of the defence– Who does the same or broadly similar work– And works under the same relevant terms and

conditions as the agency worker– At the same establishment or (if none) another

establishment

• Permanent contract of employment with the agency– Limited exception

Practical Tips

• Defining “pay” in the organisation– Pay structures and comparators

• Identifying “standard” basic terms

• Giving information to the agency

• Updating the agency

• Monitoring the 12 week qualifying period

• Contractual terms with the agency

• Reviewing the appraisal system

• Reviewing the future of agency workers in the business

Day-One rights: introduction

• From the first day of an assignment

• No less favourable treatment

• Access to “collective facilities and amenities” – Defence of objective justification

• Information about relevant permanent posts

Day-One rights: collective facilities and amenities (1)

• Non-exhaustive list: – Canteen and similar facilities– Child-care facilities– Transport services

• Off-site facilities?

• Amenities designed to reward long-service?

• Suitable comparator

• Qualifying conditions

Day-One rights: collective facilities and amenities (2)

• Justifying less favourable treatment:– Business / organisational grounds?– Costs?

Amenities and facilities – the next steps: • identify relevant facilities and amenities• review / revise access conditions• identify suitable comparators• consider justification, where necessary

Day-One rights: information about vacancies

• Equal access to information about vacancies

• Non-prescriptive method

• No impact on final recruitment decisions

• Redeployment?

Day-One rights: enforcement and remedies

• Tribunal claim against the hirer:– Breach of Day-One right– Unfair dismissal (automatic) – Detriment

• Information– Adverse inferences

• No contracting out

• Just and equitable compensation