Agency Workers Regulations come into force on 1st October

The Agency Workers Regulations 2010 come into force on 1st October. They give agency workers the right to the same basic working and employment conditions as comparable employees of the hirer after a qualifying period of 12 weeks. Although the regulations are designed to protect and grant new rights to agency workers they will not give agency workers employee status and agency workers will not have unfair dismissal rights or the right to receive statutory redundancy pay.

Who is an agency worker?

For the purposes of the Regulations, agency workers are individuals:

•Supplied by a temporary work agency to work temporarily for, and under the supervision or direction of, a hirer; and
•Who have a contract with the temporary work agency, either one of employment or one which obliges the agency worker to perform work or services personally.

What rights will agency workers have?

- Immediate rights

As soon as they start work with the hirer, agency workers will have the right to access the hirer’s collective facilities and amenities, such as canteen facilities, childcare facilities and transport services. Agency workers will also have the right to be given information about any relevant job vacancies within the hirer that would be available to a comparable employee or worker.

- The qualifying period

The Regulations require an agency worker to complete a qualifying period of twelve weeks in the same role with the hirer before they can take advantage of other rights under the Regulations. For part-time agency workers, any week in which they work will count as a full week for this purpose.

An absence from work of up to six weeks for any reason will pause, but not break, continuity for the qualifying period, and there are also situations where the qualifying period will continue to accrue during an absence (for example, where the absence is for maternity leave) or where an absence of longer than six weeks will not break continuity (for example, longterm sick leave, subject to certain conditions).

- Rights after the qualifying period

After completing the qualifying period, the agency worker will have the right to the same basic working and employment conditions as he would have been entitled to had he been directly employed by the hirer to do the same job. The relevant terms and conditions are those relating to pay, duration of working time, night work, rest periods, rest breaks, and annual leave.

What is included in the definition of “pay”?


•Wages and salary
•Holiday pay
•Paid bank holidays
•Overtime rates
•Shift allowances
•Unsocial hours premiums
•Performance-related bonuses

Not included:

•Sick pay
•Pension – agency workers will be covered by new automatic pension enrolment which will be phased in from October 2012
•Maternity, paternity or adoption leave pay
•Redundancy pay or any other compensation for loss of office
•Share, share option or profit sharing schemes
•Payments for time off work for trade union duties
•Guarantee payments
•Advances or loans
•Any bonus or incentive or reward not directly attributable to the amount or quality of the work done, and which is given so as to encourage the worker’s loyalty or to reward the worker’s long-term service
•Any payment to the worker other than in that person’s capacity as worker

What will happen if the Regulations are not complied with?

Agency workers will be able to bring claims against either the temporary work agency or the hirer in the employment tribunals for breaches of the Regulations. The time limit for making a claim will be three months from the date of the alleged infringement.

A tribunal will be able to make a declaration, order payment of compensation and make recommendations for action to be taken. The compensation payable by an agency or hirer will have regard to the extent of their responsibility for the breach, the nature of the breach, any fi nancial loss suffered by the worker and any expenses they have reasonably incurred as a result. There will be a minimum award of two weeks’ pay regardless of any loss suffered unless the employment tribunal finds that the worker behaved unreasonably. There will be no maximum award. However, if the tribunal fi nds that the agency or hirer has intentionally structured the agency worker’s assignments in order to avoid the effect of the Regulations, it may award additional compensation of up to £5,000 to the agency worker.

What should businesses using agency workers do to prepare?

Businesses should examine their current and projected future use of agency workers and consider whether they need to change their current practices in order to comply with the Regulations. Many businesses will adapt to the new regime. Some may decide that it is preferable to avoid using agency workers in the future for periods longer than twelve weeks. Others may reduce their reliance on agency workers by bringing agency workers in-house, or by requiring existing employees to change their working arrangements.

This article first appeared in Law-Now, CMS Cameron McKenna's free online information service, and has been reproduced with their permission. For more information about Law-Now, click here.