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The New Agency Workers Rules

Temporary workers are to receive the same pay and benefits as permanent employees after just 12 weeks in a job following the introduction of the new Agency Workers rules that came into effect on October 1st 2011.

Acas, the Government’s mediation service, has warned that businesses that fail to comply with the new rules could be fined £5,000 per temp working for them.

There are about 1.4m temps in the UK set to benefit from the new rules that are expected to cost business some £1.8 billion a year.

However, a recent study from the Recruitment and Employment Confederation warned only one in 10 employers was prepared for the law. “Businesses really need to make sure that they have a handle on these changes. It’s not something to think about down the line and get it wrong, as it can be costly to your business,” said John Taylor, Acas chief executive.

“Some employers may try to get round the regulations by hiring and rehiring temps on a succession of shorter periods. But they need to be careful of the many provisos within the new law. We would always urge employers to take a fair approach as the basis for any workplace relations.”

Acas has produced guidance on how businesses should implement the new law. A summary is set out below, but full details can be found at this link

The key changes

After 12 weeks in the same job, an agency worker will be entitled to the same basic working and employment conditions as an employee recruited directly by the employer to do the same work.These conditions include the same:

  • Basic hourly pay rate
  • Overtime
  • Shift allowances
  • Unsocial hours’ premiums
  • Payments for difficult or dangerous duties
  • Lunch vouchers
  • Bonuses for the quality and quantity of work
  • Rest breaks
  • Annual leave allowance

Agency workers will be entitled to some benefits from day one of a job. This includes ensuring that agency workers are made aware of vacancies that arise in the business as well as allowing the use of existing collective facilities, such as:

  • Crèche
  • Childcare
  • Canteen
  • Transport

However, company offers such as subsidised gym membership, season ticket loans and childcare vouchers are outside the regulations.

Agency workers will still not have rights to:

  • Unfair dismissal
  • Redundancy pay
  • Maternity leave
  • Occupational sick pay
  • Company pension schemes
  • Financial participation schemes
  • Bonus payments based on organisational or company performance

Employers will have to give information to workplace representatives on the use of agency workers -including the total number of agency workers hired by the organisation, in what areas of the business they are working and the types of work they do.

The regulations apply to all temporary agency workers. The regulations do not apply to the self-employed.

It will be largely the responsibility of the recruitment agency to ensure that its worker has parity on pay and conditions with employees at the company where they have been hired.

This article originally appeared in our November 2011 Loyalty Generator e-newsletter.