4 October 2011

Here come the Swedes!!

Everyone is now aware that the new Agency Workers Regulations are now in force.  This means that any such worker is entitled to the same pay as permanent workers on any assignment lasting longer than 12 weeks. However, it seems that the Agencies and their lawyers have been working on this problem, and are making full use of the "Swedish derogation".

This requires the use of umbrella companies who take on the agency workers as employees and pays them between assignments.  In those circumstances, although most of the other entitlements remain in place, the Agency workers do not have to be paid the same rate as permanent staff.

BPIF is now seeing several of the contracts being drawn up with this in mind, and has the following warnings:

Unless the contract is watertight, the Swedish derogation will not operate. If the employment contract is defective in some way, the Hirer could find itself with a very expensive exercise in back pay if their agency workers take them to Tribunal. 

Agencies appear to be offering this option to larger companies with the need for long-term Agency workers.  It won't be worth their while to do it if your requirements are more ad hoc.

Any such employment contract must be in place before the start of the assignment.  BPIF have seen contracts drawn up by Agencies where the worker only becomes an employee of the Agency after 11 weeks on assignment.  That will not pass muster.

Make sure you see a copy of the employment contract the Agency is intending to use.  If it doesn't comply with the Regulations, point that out immediately.

And make sure you get an indemnity from the Agency so that if any of the systems it puts in place are defective, you are less likely to have to pick up the bill.

For further information, please call 0845 250 7050