EU directive on agency workers

A new EU law comes into effect in 2011 obliging companies to give temporary agency workers the same employment rights as permanent staff, bar pensions and maternity leave. But there are ways round it, as Fiona Rushworth reveals.

THE PROBLEM

Our business makes regular use of temporary agency workers as waiters and reception staff. We need the flexibility to end their contracts on short notice if business slows down. These workers earn less than our permanent staff, and we can't afford to pay them any more. I've heard there's a new EU directive on the way that's going to make me treat them the same as our permanent workers, with the same benefits. Is this true?

THE LAW

The Council of the European Union has issued a directive aimed at ensuring all countries give limited equality to temporary agency workers by 5 December 2011. The UK Government has started a consultation process for its implementation. The legislation will focus only on temporary workers who are supplied by agencies, not permanent employees.

The proposal is that agency workers who have spent 12 weeks with an employer doing substantively the same role should be given equal rights to permanent employees in a similar role. The equal rights principle would apply only to pay and basic working and employment conditions.

The primary liability for a failure to comply with the obligations should, in the government's view, rest with the agency rather than the end-user, although the end-user may be liable if it fails to provide relevant information to the agency.

EXPERT ADVICE

When the law comes into force in the UK - which could be at any time before December 2011 - it is currently proposed that you will need to start giving temporary agency workers the same pay as your permanent employees doing a similar role, once they have been in that role for 12 weeks.

You will also have to treat them the same as permanent employees with regard to certain other rights, such as:

• working hours;
• overtime and shift allowances;
• breaks;
• holidays;
• bonuses directly related to individual performance or output.

However, you won't have to give them access to less basic employment benefits, such as pensions, paid maternity leave, and private health insurance.

If you cannot afford to give agency workers the same rate of pay and basic benefits as your permanent staff, bear in mind that, under current proposals, you will not have do so for the first 12 weeks that they work for you. At 12 weeks, you have the option to stop using that particular agency worker.

If the Government's proposals are enacted, you will also be able to move a worker into a different role (for example, move waiting staff to reception) or stop using them for a certain period (perhaps two weeks) to avoid having to give workers equal rights.

If agency workers believe they have not been given equal rights, the claim they make will be against the employment business, not against you. However, if you fail to provide the agency with information on the terms and conditions of your employees and agency staff, liability could be transferred to you. This will mean an extra administrative burden on organisations that use agencies.

If the law is enacted in line with the current proposal, you do not need to be concerned that agency workers will gain the status of "employees" and have the right to bring claims against you such as unfair dismissal. You will still be able to end their contracts on short notice.

TO DO CHECKLIST

Employers: If you wish to comment on the proposed regulations, you can do so at www.berr.gov.uk/files/file51197.pdf

Once the regulations are enacted, you will need to keep records of agency workers and employees' pay and conditions so that these can be provided to agencies.

If you wish to avoid giving agency workers equal rights, you will have to monitor the length of their contracts to ensure that they do not exceed 12 weeks in the same role.

BEWARE!

Greater cost for employers in ensuring compliance.

Greater administrative burden in keeping records and providing them to agencies.

CONTACTS

Fiona Rushforth, employment lawyer, Wedlake Bell

THE BRIEFING

Paternity leave extension on hold

Plans to give fathers six months' paternity leave have been shelved by the Government to help employers during the recession.

The proposal, announced in 2005, was going to be introduced this year to allow mothers and fathers to share a year of parental leave, with fathers able to take six months' leave after the mother's first six months.

However, the plans were strongly criticised by business groups as being too costly and an administrative headache.

A Department for Business, Enterprise and Regulatory Reform spokesman said plans to introduce the rights this year were on hold.

Under the current legislation, fathers are entitled to two weeks' paternity leave to be taken just after the baby is born.

Length of service counts

The Court of Appeal announced this week that companies can take employees' length of service in to consideration when choosing who should be made redundant.

Ruling on the case of Rolls-Royce versus Unite, the High Court and the Court of Appeal both ruled that length of service was an acceptable factor for a company to consider when scoring employees in a redundancy exercise, and not in breach of age discrimination legislation. Rolls-Royce argued that taking length of service into consideration would put its younger workers at a disadvantage and would therefore be discriminatory.

The ruling means that, although employers cannot use this factor alone when selecting redundancy candidates, it give them a little more flexibility in deciding who should be retained.