An agency worker is someone who is recruited and employed by an employment agency or temporary work agency under a contract of employment with the agency, rather than with the company for which they are assigned to work.
When you’re working with agency workers, as an employer, you must know if they are classed as an ’employee’ or a ‘worker’ under employment status law. Their employment status affects what they’re entitled to and what your obligations towards them are as an employer.
For this article, we will focus on agency workers and their entitlements as a worker, and your responsibilities when inviting them into your workforce.
Agency Worker Regulations
There are 3 main types of employment status under employment law (Employment Rights Act 1996):
Each category of employment offers different employment rights and you can check the full criteria for each category via ACAS.
The Agency Worker Regulations 2010 (the “AWR”) gives agency workers certain rights after 12 weeks in a job, including the right to be treated equally to permanent staff in terms of pay and working conditions. They must not be treated less favourably than permanent employees concerning access to recruitment, training opportunities, or selection for redundancy. The AWR does not apply to some types of workers, such as those who are self-employed or working through a limited company.
Agency Worker Rights
As an employer, you must ensure agency workers at your organisation are treated fairly. Workers have rights regarding statutory pay, discrimination and holiday from the day they start working with you, but these rights will expand after 12 weeks of working for you on the same assignment.
This is known as the ’12-week minimum qualifying period’ under the law. Any 7 days that they work in counts as a qualifying week and entitles the workers to the same pay and conditions as permanent employees for doing the same job, information about job vacancies, and protection from unfair dismissal and redundancy when making decisions about hiring or promotion. By understanding and meeting your responsibilities, and the timelines involved, you can create a positive and productive working environment for all workers and employees.
From the beginning of their time working for you, an agency worker has the following rights:
- Protection against discrimination
- National Minimum Wage entitlement
- A minimum of 5.6 weeks holiday entitlement – holiday that hasn’t been taken can be carried over to a new assignment and workers can get paid for any holiday they’ve not taken if they leave the agency.
- To be provided with written terms and conditions of employment including information about their rights and entitlements
- To be given adequate health and safety protections and working conditions that comply with all relevant legislation.
After 12 weeks of working with your company, an agency worker has the following additional rights:
- Equal treatment concerning pay. This means they should be paid on time by an agreed method, pay should be the same as a full-time employee doing the same job, including overtime pay, commission, unsocial hours pay, and performance-related bonuses and no unlawful deductions can be made from their salary.
- Agency workers should receive the same annual leave entitlement as other employees at the company if this is more than the statutory requirement.
- Sick leave and Statutory Sick Pay (SSP), if they are eligible for it but Agency workers are not entitled to the same amount of sick pay as direct employees at any point.
- The right to the same working patterns and rest breaks as direct employees including any entitlement to longer lunch breaks or other breaks.
- Access to permanent job vacancies at your organisation and the right to request information about job vacancies available
- Without employee status, agency workers are not entitled to maternity, paternity or adoption leave or Shared Parental Leave, but they can stop working to care for their child.
- Equal treatment for working conditions, meaning they can access the same facilities, such as canteen and childcare facilities, and access to collective facilities and amenities as permanent staff
- To be given adequate training and support, so that they can perform their roles effectively.
- To join a trade union,
- To be protected from unfair dismissal, discrimination and victimisation at work.
Benefits Of Hiring Agency Workers
In the current economic climate, more and more employers are choosing to use agency workers to fill temporary positions as this can be a cost-effective way to meet short-term staffing needs, along with the following additional benefits:
- Greater flexibility in your workforce that can help to improve productivity as businesses can bring in extra staff during busy periods.
- Agency workers can be hired on a short-term basis to cover seasonal roles, absences or spikes in demand
- Using agency workers can help to reduce the risk of disruption as businesses can easily replace agency workers if they are not working out. This can help to reduce costs and avoid the need to lay off permanent staff during periods of economic uncertainty or business downturn.
- Agency workers are often more highly skilled than the permanent workforce, which can help to improve the quality of work.
- Using agency workers avoids the costs and time of advertising and interviewing permanent staff.
- Using agency workers can help to boost morale among permanent staff, as they may feel appreciated knowing that their jobs are secure even when there is a downturn in business.
If You Breach The Rights Of Your Agency Workers;
- You could face liability for unfair dismissal, discrimination or breach of statutory duty which could all lead to tribunal and damages having to be paid to the worker or fines.
- You could cause the worker to suffer stress and anxiety which impacts their morale and health
- Your workers miss out on important entitlements like equal pay or holiday
As you can see, you must understand the employment status of everyone that you hire. Be it as an employee, self-employed person or an agency worker, each type of working relationship is governed by a different set of rights and responsibilities.
If you would like support with managing and understanding your HR and employer responsibilities towards your agency worker workforce, please contact us.