Anyone working through a Recruitment Agency, who is under the direct supervision and control of the hirer, will fall under the scope of The Agency Worker Regulations. This legislation came into force on 1st October 2011. It also applies to individuals who have their own Limited Company (PSC) and whose working practices fall inside IR35. It could be assumed that the AWR reinforces the IR35 legislation. This could strengthen HMRC’s case against those whose contract is not an accurate reflection of their working practices.
The most recent guidance for the agency worker regulations, issued in June 2011, states:
“If the arrangements do not reflect the reality of the relationship (e.g. despite the wording of the contract, the actual reality is that the individual is not in business on their own account and they work under the supervision and direction of the hirer) or are an avoidance tactic, then individuals are likely to fall into scope of the Regulations.”
Unlike the Conduct of Employment Agencies and Employment Businesses Regulations there is no opt-out from The Agency Worker Regulations; The only exemption is from Section 5. This relates to equal pay and this is only if an Umbrella Company has implemented the Swedish Derogation Model.
Contractor Statutory Rights
Contractors are already entitled to a range of statutory protections, whilst working through an umbrella company. These rights are provided by the Working Time Regulations, National Minimum Wage legislation etc. This legislation is intended to give additional protection and rights equal to those of permanent employees in comparable positions.
Some of the rights are available from day one at a client’s site. These concern accessibility to site facilities and information on job vacancies. Ensuring that these provisions are made is the responsibility of the hirer who will be liable for any breach of the obligation. For instance, if the company has parking facilities which are available to all its employees, those facilities would also need to be made available to temporary workers. However, it does not mean that they would be entitled to preferential treatment. So, if the company had only 5 parking spaces which were available to the longest serving members of staff, the temporary worker would not be able to jump the queue.
The client or hirer is not obliged give access to off-site facilities which they do not directly provide; eg subsidised gym membership or the opportunity to purchase discounted company goods. The legislation is not intended to give enhanced rights. Simply to ensure that treatment should be ‘no less favourable than a comparable worker’; i.e. one doing the same or a similar job at the same location.
Day One Rights
Listed below are those types of facilities that should be made available from the first day at a client site; the list is not exhaustive as available facilities will vary from site to site.
A workplace crèche
Staff common room
Mother and baby rooms
Food and drinks machines
The hirer is also obliged to provide information about any relevant job vacancies that the client has that would be made available to a comparable worker. Again the intention is not to give preferential treatment. The client will still have complete freedom with regard to qualification or experience requirements and how applicants are treated. The right to information will not apply when there is a genuine headcount freeze or when internal moves are required to restructure or avoid redundancy.
12 Week Qualifying Period
The Legislation makes other new rights available after a qualifying period of 12 weeks, with the same client, in the same role:
Duration of working time
Paid time off for ante-natal appointments
The 12 week period refers to 12 calendar weeks. This is irrespective of how many hours are actually worked in that 7 day period.
The qualifying period is also not altered by a change of Employment Agency; it refers solely to the time spent working at a particular client site.
The qualifying period should be ‘re-set’ when a new assignment begins for a new client or when a new assignment begins for the same client but in a new role or when there is a break between assignments of 6 weeks or more. Breaks of more than 6 weeks may sometimes merely ‘interrupt’ the qualifying period e.g. sickness or annual leave. The qualifying period cannot be broken by moving from one site to another within the same company unless the role is completely different.
Pregnant Temporary Worker Rights
After the qualifying period has been completed pregnant temporary workers will be entitled to take paid time off for antenatal medical appointments and antenatal classes. In cases where the original assignment cannot be completed for Health and Safety reasons it will be necessary for another assignment to be found. Under certain circumstances it may be necessary for the client to carry out a risk assessment to determine whether or not the role is still appropriate. If a risk assessment determines that the original placement is unsuitable, a suitable alternative must be offered and cannot be unreasonably refused. If an alternative role cannot be provided by the Employment Agency, they will be obliged to pay the contractor at the same rate for the duration of the terminated assignment.