The recent ruling in Wood Group Engineering (North Sea) Ltd v Robertson that agency workers are not the employees of the end user is to be welcomed by businesses that use them.
Ms Robertson entered into a contractual agreement with NES, an employment agency. Under this agreement, NES was obliged to find suitable work assignments with various end-user businesses for her, which she was able to accept or decline. Ms Robertson was to comply with the end-user's rules of work and was paid by NES on production of a time sheet signed by the end user. Ms Robertson undertook an assignment to work for WGE, the end-user in the arrangement. WGE then advertised for a full-time receptionist. Ms Robertson applied for and was offered the job. After eight months working under a written contract of employment with WGE, Ms Robertson's employment was terminated and she brought an unfair dismissal claim. As she had worked under the express contract with WGE for less than one year, she argued that she had been an employee of WGE prior to that under an implied contract of employment.
The Court of Appeal in Dacas v Brook Street Bureau (UK) Ltd had previously stated that in relation to agency workers tribunals should consider the possibility of there being an implied contract of employment between the worker and the end-user. Notwithstanding this authority, the EAT held that she had been an employee of WGE for only eight months. The EAT stated that where there is an existing written contract with an agency which reflects the arrangements, tribunals should not imply a contract between the worker and the end-user of their services.
This is the latest in a string of EAT rulings including James v Greenwich Borough Council and Craigie v London Borough of Haringey in which the EAT has restricted the Court of Appeal's guidance in Dacas, preferring to return to a narrow interpretation of such agency arrangements.
Impact on employers
- The important message for businesses who use agency workers is to ensure that the contractual arrangements between the agency and the worker are clear and written down.
- End-users are advised to make it a requirement of their contract with the agency that the agency will have written contracts with the workers and will make the form of the contract available to the end-user to check that it does reflect its understanding of the relationship.
- In recent cases, the EAT has not followed the Court of Appeal's decision in Dacas. However, the Court of Appeal has granted permission to appeal the decisions in James v Greenwich Borough Council and Craigie v London Borough of Haringey so we may not yet have heard the last word on this issue.