Under the terms of the new Regulations (due to come into effect in October 2011), agency workers will be entitled to the same basic working and employment conditions as if they had been recruited directly by the business, once they have completed a 12 week qualifying period.
Which terms and conditions are included in the comparison?
Comparable salary, overtime or commission payments, rest breaks and holiday entitlement.
- Benefits in kind are excluded but vouchers or stamps of a fixed monetary value are included.
There will be rights, from day one, to access collective facilities (e.g. canteen, crèche and transport) on the same basis as employees/workers.
Bonuses, incentive payments or rewards not directly attributable to the amount or quality of the work done by a worker are excluded.
Company sick pay, redundancy pay and pension are excluded.
Options
The Government estimates that, in addition to the £1.8bn per year of increased costs, 1.5 hours of a HR manger’s time per agency worker will be required in respect of monitoring and administration. It is therefore vital that employers which regularly use agency workers review their current practices and consider which option they will pursue:
Ensure agency workers never pass the 12 week qualification. However, note that any ‘structure of assignments’, such as placing agency workers on a series of 11 week contracts or varying their roles every few weeks, is prohibited and may also attract additional financial penalty in the form of a fine of up to £5,000. Furthermore, in calculating the 12-week qualifying period, breaks between assignments, or during an assignment, will not break the continuity if they are for not more than six weeks or are for one of a number of specified reasons (i.e. sickness or maternity leave).
Move to direct recruitment only (rather than using agencies as a recruitment source).
Engage casual workers through an ‘in house’ bank.
Establish an arrangement whereby a third party (possibly an agency) employs workers directly.
Increase the use of self-employed workers and managed service contracts, both of which fall outside the scope of the Regulations.
Negotiate exclusivity with a small number of agency suppliers, whilst also renegotiating terms to reduce risks and costs.
Review the way in which pay and benefits are packaged and decide whether they fall within the equal treatment requirements of the Regulations or, with adjustment, can be excluded.
To continue employing agency workers past 12 weeks and to act in accordance with the Regulations.
Changes?
Prior to the election, the Conservative party stated that it wanted to review the Regulations and make some changes, especially in relation to the 12 week qualifying period. However, the Coalition Government has not yet made any statement on when, or if, these Regulations will be reviewed. We’ll continue to monitor the situation and update clients on any proposed changes. In the meantime, if you are considering employing agency workers, please contact us to discuss what impact the Regulations may have on your business.
For a no obligation chat about how the new agency workers regulations may effect you and your business and how we can assist you, please contact
Suki Harrar.
