Thursday 15 September 2011

Oliver McCann Employment Partner Taylors Solicitors

THE AGENCY WORKERS REGULATIONS The Legal Bits!

Introduction Agency Workers Regulations in force from 1 October 2011 The aim is to ensure the protection of temporary agency workers by applying a principle of equal treatment The Regulations will affect the tripartite relationship between an Agency Worker, the Hirer and the Temporary Work Agency

Who is an agency worker “AW” 1. Supplied by the Temporary work agency (“TWA”) 2.Under a contract with the TWA: either a contract of employment or other contract to provide work / services personally 3. To work temporarily for and under the supervision and direction of a Hirer (the end- user)

Who is not covered? X The genuinely self-employed (i.e. contractors, consultants, freelancers) Where the individual is in business on their own account and the agency or hirer is a client or customer of the business or profession being carried on by that individual X Genuine Managed Service Contracts X Those employed directly by the hirer Note: “sham” self-employed or Managed Service Contracts will be covered under the Regs

Equal Treatment – in summary After a 12 week qualifying period an Agency Worker (AW) will be entitled to: “the same basic working and employment conditions as AW would be entitled to for doing the same job”… had AW been directly recruited by the Hirer “at the time the qualifying period commenced” Deemed compliance with the equal treatment provisions if you can show that the AW is working under the same terms and conditions as a comparable employee of the Hirer

Equal Treatment cont... Who is a comparator? Current, NOT former, employee; Working or based at the same workplace, or another of the Hirer’s establishments; and “... engaged in the same or broadly similar work having regard, where relevant, to whether they have the same level of qualification and skills” No comparator – no claim for equal treatment

Day 1 Rights! From day 1 of a worker’s assignment, they are entitled to: Access to facilities and amenities (Reg 12) Access to information regarding vacancies (Reg 13) Sole responsibility for breach of day 1 rights lies with the Hirer! It is therefore the responsibility of the hirer to ensure that Agency Workers are given access to these rights.

Day 1 Rights! Cont… Access to facilities and amenities: Canteen, childcare facilities, car park, showers, prayer rooms etc Collective facilities only They are not entitled to “enhanced” benefits – any waiting list will still apply Possible to objectively justify less favourable treatment regarding access to facilities i.e. if there is a good reason for treating the Agency Worker less favourably – but in practice this is likely to be difficult for most facilities

Day 1 Rights! Cont… Access to information on job vacancies: Entitled to information on any relevant vacant posts with the Hirer which would be available to a comparable employee or worker Think about the practicalities of this requirement – use of the staff intranet to give vacancy information? Ensure that the Agency Worker knows how to access such information

12 Week Rights The Scope of Equal Treatment The term “Equal Treatment” is somewhat misleading…… After 12 weeks the AW will be entitled to the same basic working and employment conditions only This means the relevant terms and conditions that are ordinarily included in the contracts of employees and workers of the hirer The Regs do NOT give AW the full employment protection rights that the Hirer’s permanent employees might enjoy

12 Week Rights The Scope of Equal Treatment Cont… Relevant terms and conditions include: Pay (see next slide) √ Working time limits √ Holiday entitlements √ Rest breaks √ Pay structures, scales or gradings √ Relevant collective agreements √ Company handbooks √

12 Week Rights: What is “Pay”? Includes:Excludes, for example: Basic Pay (hourly rate, annual salary etc) X Occupational maternity / paternity / adoption pay FeesX Occupational pensions Holiday PayX Occupational sick pay Commission directly attributed to work done (e.g. “piece work”) X Redundancy pay OvertimeX Notice pay Shift allowances (unsocial etc)X Expenses Vouchers with monetary valueX Bonuses NOT relating directly to work done (e.g. discretionary, profit related)

The 12 week qualifying period 12 calendar weeks’ service in the same role for the same hirer Change of role restarts qualifying period Change of hirer ends qualifying period A change of agency during this period will NOT affect qualification There is no minimum amount of work that will need to be completed in order for a week to count (any part of a week worked will count towards continuity)

Continuity will be broken if: 1.The Agency Worker starts a new assignment with same hirer involving “substantively different” work or duties; or 2.There is a break of at least 6 calendar weeks either during or between assignments BUT Remember: The Anti-avoidance provisions (£5,000 fine – see later slide) Not all absences break continuity…. The 12 week qualifying period

“CLOCK PAUSED”“CLOCK TICKS” Sickness absence up to 28 weeksWeeks of statutory or contractual maternity, paternity or adoption eave Statutory or contractual leave (NOT incl. maternity, paternity, adoption) Absences relating to pregnancy, childbirth or maternity (up to 26 weeks) Jury service up to 28 weeks Work place closures (i.e. Christmas / Summer shutdown) Industrial action / lock-out “CLOCK RESTARTS”: Break of 6 weeks, new role, new Hirer

The Swedish Derogation An exemption from the equal treatment pay provision where the AW has a permanent contract of employment with the TWA (entered into before the first assignment with the Hirer) contract provides for the AW to be paid between assignments IMPORTANTLY - all other equal treatment rights under the Regs will continue to apply to the AW (i.e. annual leave entitlements, rest breaks etc.) – the derogation applies to PAY ONLY!

The Swedish Derogation cont... Conditions include: The contract must contain certain terms (including rate of remuneration and method of calculation, location of work, maximum, minimum and expected hours of work, and the nature of work). The contract must contain a statement that during the contract, the AW does not have any entitlement to equal pay rights under the Regulations. The contract must provide a minimum protection of at least 4 weeks pay between assignments before contract can be terminated The level of pay between assignments must be at 50% of on-assignment pay (calculated over the previous 12 weeks) and not below national minimum wage The contract must provide a minimum 1 hours work during assignment – zero hours contracts are not permissible Until case-law develops, the derogation is untested. It is likely however, that models based on one-hour per week assignments will be challenged!

Right to Receive Information AW can make a written request for information relating to equal treatment Day 1 Rights: Request to be made directly to the Hirer Week 12 Rights: Request to be made initially to the TWA TWA has 28 days to respond with a written statement; If the AW has received no response after 30 days, the AW can make the request directly to the Hirer. The Hirer then has 28 days to respond If the AW receives no response or is unhappy with the response then a claim can be made to the Employment Tribunal within 3 months of the alleged breach The Tribunal can draw adverse inferences from any failure to respond or from any response which is deemed evasive or equivocal

Liability Temporary Work Agency liableHirer liable Week 12 Rights: Liable for breaches to the extent that it is responsible for that breach Statutory defence available: “reasonable steps” taken to obtain relevant information from the hirer and acted reasonably – full responsibility pass to the hirer Regard will be given to any steps which the hirer has taken to enable the agency to provide information to the worker Sole responsibility for breach of Day 1 Rights In practice – liability will most likely be apportioned under the contract between TWA and Hirer

Remedies Compensation: No Cap! Such amount as the Tribunal deems “just and equitable” Declaration: setting out rights of the complainant Recommendation: setting out action to be taken Automatic unfair dismissal / detriment claims: if the reason for dismissal / detriment is connected with the AW exercising or insisting on their rights under the Regs, including: Issuing a complaint / proceedings under the Regs; Giving evidence in connection with those proceedings; or Making a request for information

Anti-Avoidance Anti-avoidance provision to prevent Hirer or TWA from structuring assignments to fall outside the qualifying period: Where Hirer or TWA tries to prevent the AW from qualifying for the protection of the Regs (i.e.reaching 12 weeks) via: Number or length of assignments Role changes with the Hirer Breaks between assignments etc Additional penalty of £5,000 payable to AW by the responsible party.

Question Point Can you get away with adopting a policy of dismissal at week 11? Would such dismissal be deemed automatically unfair?

Taylors Solicitors Employment Team Oliver McCann – Elaine Hurn – Leanne Eddleston Rawlings House Exchange Street BLACKBURN BB1 7JN Ninth Floor 80 Mosley Street MANCHESTER M2 3FX Tel: