Agency Workers Regulations 2010 in force since October 1 st 2011 Summary

Who do the Agency Workers Regulations apply to? Individuals who work as temporary agency workers; Businesses who take in Agency workers (Hirers)

Main points / scope Equal treatment relates to basic working and employment conditions "as if" the worker had been recruited as an employee by the hirer directly The full scope of equal treatment starts after a 12 week qualifying period working in the same job with the same hirer

New entitlements for agency workers from 1 st October 2011 After 12 weeks in the same job: equal treatment entitlements relate to pay and other basic working conditions (annual leave, rest breaks etc)

Definition of what “pay” includes Basic pay based on the annual salary (usually converted into hourly or daily rate, with any pay increments); Overtime payments, subject to any requirements regarding the number of qualifying hours equal to permanent employees’; Shift / unsocial hours allowances, risk payments for hazardous duties equal to employees’; Payment for annual leave; Bonus or commission payments directly linked to the amount or quality of the work done. Includes non-contractual payments paid with such regularity that they are a custom and practice; Vouchers or stamps with monetary value (not “salary sacrifice schemes”) such as luncheon or child care vouchers.

“pay” excludes Occupational pay: sick, pension, maternity, paternity or adoption pay; Redundancy and notice pay; Payment for time off for Trade Union duties; Advances in pay or loans e.g. for season tickets, expenses; Payments or rewards linked to financial participation schemes (share ownership, phantom share schemes); The majority of benefits in kind given as an incentive or reward for long-service; Bonuses not directly linked to the contribution – e.g. a flat rate bonus to encourage loyalty or long term service; Additional discretionary, non-contractual bonuses, as long as they are not made with such regularity to make them custom and practice.

12 week qualifying period Equal treatment entitlement (Day 1 already included) starts after the temporary completed 12 weeks in the same role with the same hirer A calendar week is any period of seven days starting with the first day of an assignment, accrued regardless of hours. A hirer can decide not to engage agency workers beyond 12 week; there is nothing in the Regulations to prevent this. If a start – stop pattern emerges depriving an agency worker of their entitlements, it will be considered as an avoidance.

12 week qualifying period continued New hirer must be a different person / legal entity. Anti-avoidance provisions prevent assignments being structured to prevent completing the qualifying period; New role with same hirer must be substantively different;. There has to be a genuine and real difference to the role for the clock to reset to zero; For the clock to reset to zero, the hirer must notify the agency that the work / duties have changed. This information must be passed to the agency worker, providing a description in writing to the agency worker.

Pausing and resetting the clock Type of absence that affects 12 week qualifying period Effect on 12 week qualifying period Break between assignments of more than 6 weeksClock resets to zero Any reason where the break is less than 6 weeks:Pauses the clock Sickness absencePauses the clock for up to 28 weeks Annual leavePauses the clock Shut downs e.g. closures, school holidaysPauses the clock Jury servicePauses the clock for up to 28 weeks Industrial actionPauses the clock Pregnancy and maternity-related absenceClock keeps ticking Statutory maternity, paternity or adoption leaveClock keeps ticking

Who is OUTSIDE of the scope: individuals who find work through a temporary work agency but are in business on their own account (Self-Employed); those working on Managed Service Contracts not under the direction and supervision of the host organisation; It is important to be aware of a number of anti- avoidance provisions set out in the AWR in order to establish a genuine outside the scope position.

Swedish derogation (Reg 10) This type of contract offers an exemption from equal treatment provisions on pay (and holiday pay); The Agency, offers an agency worker, a permanent contract of employment, and seconds the worker to the Hirer. The worker is paid between assignments; Permanent contracts providing for pay between assignments have to be entered into before the beginning of the first assignment under that contract; The contract of employment has to contain a statement that the agency worker does not have any entitlement to equal pay as set out in AWR.

“Swedish derogation” continued During the periods when agency worker is not working due to no available suitable assignments for the agency worker, the agency has to pay them for a minimum of 4 weeks; The rate of pay between assignments must be at least 50% of on assignment pay, or at least National Minimum Wage calculated at the highest pay rate and hours enjoyed in the course of the previous 12 weeks The Regulations refer to contracts of greater than ‘one hour’ per week ‘Zero hours’ contract will not meet the requirements of the derogation contract