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FastTrack's Guide to the AWR

The implementation of the new AWR legislation is dawning upon us, and if you’re not yet up to speed with the details, then it’s time to catch up!

This is FastTrack’s interpretation of the AWR…

The final Agency Workers Regulations were published in January 2010 and it will come into force 1st October 2011 and is designed to protect agency workers from exploitation, giving them the same basic employment rights as their permanent equivalents.

From October 1st going forward, agency workers will be entitled to the following rights:

Day 1 rights start on the day the agency worker commences their assignment, from that day the worker is entitled to:

Access to Canteen
Childcare
Transportation
Car Parking
The right to be informed of any relevant job vacancies with the hirer

After a temporary worker has completed a period of 12 weeks with the same hirer, the worker becomes entitled to the same rights as a comparable worker (a permanent employee).

Post Qualification Rights Include:

Pay which includes a base hourly rate and overtime – where overtime is considered as additional hours to basic hours.
Rest Periods & Breaks
Night work
Hours of work
Contractual Annual Leave (Above Statutory Minimum)
Bonus & commission payments relating to work completed
Vouchers

When quantifying the 12 week period the AWR sets some clear guidelines. If the temporary worker leaves an assignment before 12 weeks and subsequently returns to the same hirer, this does not necessarily indicate the start of a new assignment with the hirer.

Agencies and hirers should be aware that the number of hours worked per week does not alter the workers’ rights. Therefore if a worker only works an hour a week for 12 weeks, they will still be eligible for post qualification rights.

The concept of breaks is when the qualifying period clock pauses and restarts:

A break for whatever reason, no longer than 6 calendar weeks. For example, if temporary worker left an assignment in week 4, and went back 4 weeks later, he/she would be returning on the 5th week of their assignment.
A break of up to 28 weeks due to sickness or injury preventing their ability to work
28 weeks to allow agency worker to attend jury service
Breaks caused by planned shut downs or industrial action

Both the agency and the end user (hirer) should remember that they both have a responsibility to adhere to the regulations. In regards to the provision of Day 1 Rights, these are primarily the responsibility of the hirer however the agency providing the temporary worker is responsible for ensuring appropriate working conditions are in place prior to the assignment. It is important that both the agency and hirer work in cohesion to ensure that they remain compliant.

Defining a comparable employee is essential to the AWR, as defining a comparative between an agency worker and permanent employee is critical for determining what the agency worker is entitled to in terms of post qualification rights. The comparable worker must be an individual doing the same or similar work with broadly the same experience and qualifications.

Although the agency worker will be entitled to the some equality with a permanent employee, they are not granted to ‘full’ equality under the regulations, as the following rights are NOT included:

Sick Pay (Above Statutory Minimum)
Redundancy
Pension
Maternity / Paternity / Adoption Leave
Bonuses not attributed to work done

Furthermore the legislation can be ambiguous at times regarding who is in scope of the regulations. If you are a Temporary Work Agency, Umbrella Company, Master Vendor or Hirer then you are in scope of the regulations. This is of course providing that the worker falls in scope.

Workers who fall within scope are:

Workers engaged on a PAYE contract by the agency
Workers supplied through an agency but who are employees of Umbrella employees.

Workers likely to be out of scope are:

CIS – Genuinely Self Employed individuals who find work through an agency.
Workers who operate their own limited company (PSC). These people are likely to assume higher skilled or senior positions therefore having more control of the tasks they undertake.
Individuals who are placed by an agency into a permanent role.
Workers who have a direct employment contract with the agency or Umbrella Company where the contract is not a zero hour’s contract – Derogation.

This leads us on to the ‘Derogation’ which is essentially an opt-out clause, which was negotiated by the Swedish delegation when the AWR was debated at EU level. It refers to the temporary worker being employed on a permanent basis by their Umbrella Company or Temporary Work Agency. This will dismiss their rights to equal pay as with this option they will be entitled to receive payments in between assignments. Although this option takes away their right to equal pay, holiday rights will still apply.

Conditions of the opt-out clause also include:

The permanent contract between umbrella and contractor must be formed prior to placement to their first assignment.
The employer is obliged to find suitable work for the worker
The payment to the contractor has to be a minimum of 50% of their basic pay whilst in contract and must not be less than National Minimum Wage.

Under the regulations both agency and hirer can be brought to tribunal by the temporary worker. All claims will be heard in employment tribunals and must be brought within 12 weeks of the breach occurring.

Please note that the status of the agency worker will not change under the AWR, the temporary worker will remain engaged by the agency and not the hirer. The AWR is coming into force to ensure equality nd protection - it is not designed to give preference to temporary workers over permanent employees.

How can Hirers protect themselves?

Communication is going to be essential when the regulations are in place. Communicating information between hirers and agencies will be fundamental in achieving compliance to the regulations.

Hirers need to communicate the following information with the agency:

What the basic working and employment conditions are, prior to the commencement of the assignment
The duration of the assignment
Written statement with all relevant information relating to the rights of a comparable worker or employee

If and when an assignment exceeds 12 weeks, the hirer should provide the following information:

Level of basic pay
Overtime payments
Shift allowances
Bonus Schemes
Vouchers
Annual leave entitlement

Through communicating relevant information with the temporary work agency you can effectively protect yourself against non-compliance.

What action is FastTrack taking?

There are options available to work the new regulations into our common practice and we want to ensure that the best possible action is taken to protect ourselves and our clients. We are currently making changes to our administrative operations and procedures in order to comply with the requirements of the legislation.

Our approach to the AWR is like our approach to our business, taking into account each client’s individual needs to provide a tailored service. We want to work closely with you to achieve a solution that suits you and your business needs. Our consultants are all well placed and able to offer the best possible advice, answer your questions and give constructive recommendations - it’s all part of our service!

To read the full BIS guidance on the AWR, click here.

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