No way round the agency worker rules

20th October 2011

Agencies and their clients that deliberately try to avoid the new regulations could find themselves facing hefty tribunal compensation awards The Agency Worker Regulations 2010, which came into force on 1 October this year, give agency workers the right to the same basic working and employment conditions after a 12-week qualifying period they would receive as direct employees of the end-user. An agency worker completes the qualifying period by working in the same role with the same company. However, that need not be through the same agency, nor does the agency worker have to work for 12 continuous weeks. Certain breaks in an assignment merely pause, rather than restart, the qualifying clock.

The anti-avoidance measures in the regulations have caused particular concern for agencies and their clients. These prevent agencies or end-users from structuring assignments so that agency workers do not complete the 12-week qualifying period.

To combat intentions of this sort, the regulations say that an agency worker should be treated as if the equal treatment provisions already apply, even before the 12-week qualifying period is up, in circumstances where an agency worker has:
• Completed two or more assignments with the same company
• Completed one assignment with a company and at least one other assignment with a connected company (for example, a group company); or
• Worked for the same company but in different roles.

These provisions would also apply where it seems likely that either the client or agency has structured assignments in order to try to prevent an agency worker from reaching the 12-week qualifying period.
The real sting in the tail is that, in addition to compensation for breach of equal treatment provisions, a tribunal can make an additional award of compensation of up to £5,000 if it finds that an agency or its client breached the anti-avoidance measures.

In every situation covered by the regulations, agency workers are able to raise employment tribunal claims against the agency or its client. If the claim is successful, the tribunal can make a declaration of the agency worker’s rights, award compensation (at least two weeks’ pay) and recommend action is taken to remove or reduce the adverse effect on the agency worker. Where the action is not followed, without reasonable justification, additional compensation may be awarded by the tribunal.

An agency will have a defence to a tribunal claim if it can show that it acted ‘reasonably’ to ensure equal treatment. Companies which use agency workers will have to get over their normal reticence about providing information to third parties on basic working and employment conditions (subject to compliance with the Data Protection Act 1998).

A tribunal claim may not be the first intimation of a problem, however. Depending on which entitlement has been breached, agency workers are entitled to write to the agency and/or the client to seek a written statement of their rights. Any failure to respond, or an evasive response, will not cast the agency or client in a favourable light in any subsequent tribunal.

However, the regulations do not remove the flexibility afforded to a company when deciding to take on an agency worker. Unless the anti-avoidance provisions are triggered, there is nothing to stop a hirer from taking on an agency worker for fewer than 12 weeks.
Although agency workers can already complain about a breach of day 1 rights, in most cases it will be mid-December before any complaints relating to 12-week rights are triggered. So the first reported employment tribunal decision is not expected until well into 2012.