The landscape for agency workers is about to change. On October 1 2011 UK regulations implementing the EU Temporary Agency Workers Directive (2008/104/EC) will come into force. Both agencies and employers that hire agency staff will face an increased administrative burden and potential additional cost. The key changes are as follows:

  • The rights apply from October 1 2011, but employers are responsible only for providing access to information about vacancies and access to collective amenities from that date. The right to certain pay terms and other working conditions, as if the individual were directly employed by the hirer, applies only once a worker has worked for 12 weeks in a particular role, ignoring time before October 1 2011.
  • The agency is primarily responsible for providing the relevant pay, not the employer that hires the worker. The employer must provide information about the pay terms to the agency and will be liable only if that information is inaccurate or incomplete.
  • The right to equal pay does not cover all of a worker's pay and benefits. Only certain elements of the remuneration package must be matched - principally, those that relate to pay for work done, and not elements that are intended to reflect the different nature of a permanent employment relationship, such as rewards for long service. Most benefits in kind need not be matched, although exchangeable monetary vouchers must be provided. Some forms of bonus scheme must also be matched, but the eligibility criteria applicable to employees can be used for agency workers, even if this tends to exclude most or all agency workers.
  • Temporary staff may be covered even if they are supplied not by a traditional agency, but rather by a group company (eg, where there is an intra-group staffing bank).
  • The use by a worker of a personal services company or an umbrella company does not by itself take a worker outside the scope of the regulations. Only workers who are genuinely in business on their own account are excluded.
  • All employers should consider which of their arrangements may be covered and should take steps to prepare now, including:
    • carrying out an impact assessment for their business;
    • creating systems for providing the necessary information to workers and agencies;
    • reviewing the terms of business with agencies; and
    • reviewing various policies and training.

For further information on this topic please contact Andrew Brown at Herbert Smith LLP by telephone (+44 20 7374 8000), fax (+44 20 7374 0888) or email ([email protected]).