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Agency workers

The rights of temporary staff supplied by employment agencies will depend on their employment status - as either employee or worker.

Key points

  • The rights of temporary staff supplied by employment agencies will depend on their employment status.
  • A temporary worker may or may not be an employee of the employment agency through which they are allocated work. Their status will depend on the terms of their contract and the nature of the working relationship.
  • It is possible for an individual working through a limited company to assert that they are an employee of the organisation for which they work, provided certain key criteria are met.
  • Employment businesses can use Swedish Derogation, or Pay Between Assignment, employment contracts to opt-out of equal treatment in relation to pay once the agency worker reaches 12 weeks’ service within an assignment. From 6 April 2020, the opt-out provisions of these contracts will be removed and employment businesses will have to notify their agency workers of this change by providing them with a written statement by 30 April 2020.

Recent developments

Government announces new rights for agency workers

An independent review into modern ways of working, and the use of agency worker contracts, was carried out by Matthew Taylor and resulted in the Good Work Review which was published in July 2017.

Following a consultation on this matter, the government’s ‘Good Work Plan’ released in December 2018 has confirmed that legislation will be introduced to create a new right for all agency workers to receive a Key Facts Page setting out the terms they can expect to apply to their assignment. This will come into effect from 6 April 2020.

It was further announced that current laws on the use of Swedish Derogation contracts, or ‘Pay Between Assignment’ contracts, will be amended to exclude the use of these. Once in force, all agency workers will become entitled to equality of pay, when compared to comparable full-time employees, once they reach 12 weeks’ service within one assignment. This change will take effect from 6 April 2020 and organisations will have to provide their agency workers with a written statement explaining the change by 30 April 2020.