The Court of Appeal has considered how compensation for agency workers should be calculated, and who is liable for payment of it.

London Underground v Amissah [2019] EWCA Civ 125

Facts

The claimants all worked for London Underground through an agency (trainpeople.co.uk). London Underground initially thought that the workers were exempt from equal pay and terms under the Agency Worker Regulations 2010 (AWR) as a result of the ‘Swedish derogation’. It later decided that the workers were entitled to equal terms, and the agency increased their rates of pay. Payments of the arrears owed to the agency workers were made by London Underground to the agency, but the agency failed to pass these on to the workers and subsequently went into liquidation. An employment tribunal held that there had been a breach of the AWR, and concluded that liability should be apportioned equally between London Underground and the agency. It decided, however, that it was not just and equitable for any compensation to be payable by London Underground, as the agency was at fault for not paying the arrears of pay to the workers, and London Underground should not have to ‘pay twice’.

The workers successfully appealed to the Employment Appeal Tribunal (EAT). It found that London Underground had contributed to the losses by not providing the comparator information (relating to permanent employees of the business) quickly enough to the agency, meaning that the arrears had continued to build up and were not paid back sooner. The tribunal had taken the wrong approach in calculating loss and its decision could not stand.

Court of Appeal decision

The Court of Appeal has dismissed the appeal. London Underground had been found by the tribunal to be 50% liable for the infringement of the AWR so the next step was to identify the loss attributable to that infringement, which was the loss of the enhanced pay. The tribunal was wrong in holding that it was just and equitable for London Underground to not pay the workers any compensation. Only in an exceptional case would a respondent be required to pay less compensation than the amount reflecting its liability. London Underground should, therefore, be required to pay 50% of the compensation.

Consequences

Assessment of compensation under the AWR is complex, particularly the question of how it should be apportioned between the agency and the end user. This case provides a reminder to hirers of agency workers to establish at an early stage whether the AWR might apply, as there is a significant (and potentially costly) risk if it can been shown that any fault for not complying with the requirements of the AWR lies with the hiring party. London Underground was effectively required to pay the arrears of pay twice, since it was regarded as being 50% responsible for the workers’ losses.