AWR

Agency Workers Regulations (AWR)

As you may be aware, we have been involved in a whole raft of legislation and regulation changes over the past decade and as part of our ongoing duty of care to our contractors we have to ensure that we comply with all the regulations that come into force.

This overview is to let you know what the Agency Workers Regulations (AWR) are about and also how, what, and when it affects you.
Please note the following applies throughout the below information.

AWR = Agency Workers Regulations
Agency Worker (AW) = You, the contractor
Temporary Work Agency (TWA) = Employment Recruitment Agency
Hirer = End client company

What is AWR?

The aim of the AWR is to protect temporary agency workers by ensuring, through legislation, that after 12 weeks service in the same job they have the right to equal treatment in basic working and employment conditions comparable to permanent employees.

AW's will also be entitled to access certain client facilities and information on the hirer's job vacancies from day one of their assignment.

When did AWR come into force?

1st October 2011 was the start date (please note previous completed work to this date is not applicable). AWR applies to all new and existing contracts.

Who does AWR affect?

Any individual (AW) who is supplied to work temporarily for a client (third party) under their supervision and direction of the hirer, that has a contract of employment or a contract to perform services.

What rights are you (AW) entitled to?

Firstly, Day One rights – The Hirer is responsible for providing equal treatment from day one:
An AW has the right to be treated no less favourably than a directly employed permanent individual who is completing the same or similar job at the hirer's workplace.
An AW has the right to collective facilities and amenities such as a canteen, crèche (childcare facility), car park and use of transport services.

12-Week Qualifying Period (QP):
After 12 weeks in the same job the AWR entitles agency workers to receive the same basic employment and working conditions as to permanent employees (in a same or similar role).
AW's have the right to equal basic pay, overtime, bonus and commission related to individual productivity, and the right to be paid and take the same holidays as a comparable permanent employee.

AW's will have the right to work the same hours as a comparable employee.

AW's can also receive luncheon vouchers (or anything similar provided) with a monetary value, but NOT those provided through a salary sacrifice schemes such as childcare vouchers.

How is the 12 week qualifying period calculated?

The right to equal treatment occurs after 12 weeks:
Even 1 hour worked in any one-week equals to 1 whole week of the qualifying period.
Even if an AW is supplied to work via different TWA’s there can be multiple qualifying periods running at the same time. (This is why we and the TWA will be asking you if you have previously worked at the hirer’s workplace).

The qualifying period clock can be paused or reset:

Types of absence that affect the 12 week qualifying period.

Agency worker begins a new assignment with a new hirer, the clock resets
Agency worker remains with the same hirer but is no longer in the same role, the clock resets
Break between assignments of 6 weeks or more (which is not one which ‘pauses’ the clock or during which it continues to tick), the clock resets
Any reason where the break is less than 6 weeks, pauses the clock
Sickness absence, pauses the clock for up to 28 weeks
Annual leave, pauses the clock
Shut downs – e.g. factory closure, school holidays, pauses the clock
Jury service, pauses the clock for up to 28 weeks
Industrial action, pauses the clock
Pregnancy and maternity-related absence, the clock keeps ticking
Statutory maternity, paternity or adoption leave, the clock keeps ticking

What benefits are you (AW) not entitled to?

Agency Workers will not be entitled to equal treatment in relation to redundancy pay, occupational pension schemes, share schemes, maternity/paternity rights or bonuses related to the company’s performance. Occupational sick pay, non-cash awards, advances in pay, loans or any other non-contractual payments.

How AWR affects Maternity/ Paternity pay and Antenatal appointments

As stated above with regards to maternity/paternity pay – that said, this does not affect statutory pay (if qualified).
After 12 weeks qualifying period a pregnant AW will be entitled to paid time off to attend antenatal appointments – bringing them in line with entitlements of comparable permanent employees.

How Liberty Bishop are adapting to the impact of AWR

We will be operating three employment contracts from Oct 1st 2011. The information covers why we will be supplying a particular contract, along with any changes that you will see to our service.

1. Comparator Pay Model

Under this model our starting point will be that once we have engaged with you (registered employee) that you automatically default as an agency worker (AW) and therefore, after 12 weeks in the same role with the same hirer, you will be entitled to receive the same pay and basic working conditions as you would have received had you been engaged directly by the hirer at the start of the qualifying period. This will necessarily involve seeking information from hirer's (whether via recruitment agencies or directly to the end client) as to the nature of the terms ordinarily in force within the hirers business, which would have been applied to that role.

This model will be applied in the following instances:

(a) The payments we receive on your behalf are considerably higher than a directly engaged permanent employee (i.e. so that after all of our deductions the net wage is still more).

(b) There are no terms which are ordinarily in force within the hirer's business (there is no directly employed comparator) therefore no comparable terms exist.

(c) This model may also work where the assignment does not accrue a 12-week qualifying period and therefore no additional rights apply.

Changes: A questionnaire will be issued at each stage of a new contract or extension. We will also be obtaining similar information from the recruitment agency (or hirer). Ultimately, you will see no changes to our service – we will be issuing the amended employment contract to confirm that we are applying this model.

2. Swedish Derogation Model

The Swedish Derogation is also based upon a permanent contract of employment and there are certain contractual requirements that have to be fulfilled. However, in addition you (AW) must be paid at a minimum rate for all periods in which you are not working under the direction and supervision of a hirer, but are available to do. We will also have the obligation to seek and offer suitable work.

After 12 weeks you are entitled to the same basic working and employment conditions as if you were engaged directly (same conditions do not apply to pay or holiday pay). This would effectively allows us (umbrella company) to operate our current minimum wage + commission + expenses model. The only difference would be accounting for the periods in which you (AW) are not working and are entitled to pay between assignments.

Pay Between Assignments (PBA) will be on a rolled-up basis. The rolled up PBA will be clearly reported on each payslip to emphasise that a payment has been made to you in lieu of any payment due when you are not working but are available to do so. The rolled up PBA element will be calculated at the higher of the national minimum wage or 50% of the contract rate for the first 12 weeks (so as to roll-up the minimum requirement of 4 weeks PBA within a 12 week period).

Please note this will not affect your take home pay, but there is a chance that it may encumber the level of expense claims – this will depend on your level of income. Our team will fully explain this process from the outset.

Changes: A questionnaire will be issued at each stage of a new contract or extension. We will also be obtaining similar information from the recruitment agency (or hirer).
Ultimately, you will see no changes to our service – we will be issuing the amended employment contract to confirm that we are applying this model.

With regards to seeking suitable work for you, initially we will be directing you back to the agency consultant that originally placed you on the latest contract. Alternatively, we will be directing you to our job board www.cvregister.co.uk

3. Professions Contracts

An individual can be excluded from being an agency worker by virtue of operating a profession and relevant contracts are in place indicating that the hirer is the client or customer of that individual. There is no real guidance (plenty of grey areas), precedent or definition as to what is meant by a "profession", so this is a matter to be determined. However, there has been recent case law to support a wide interpretation of wording that is not defined in legislation and there are some roles - such as Doctors, Teachers, Lawyers, Accountants, and Nurses - where it would be difficult to say that they do not have a profession.

If an individual can be excluded by virtue of Regulation 3(2) (b) of the AWR, in which case they are not an agency worker and the AWR therefore has no application, this will allow us to apply our existing model.

As stated above, our contracts will be finalised shortly. Along with the contracts we will also be issuing a service level agreement (SLA) between Liberty Bishop Contractor Services Ltd and the agency in order to ensure both parties have provided and adhered to the AWR.

Changes: A questionnaire will be issued at each stage of a new contract or extension. We will also be obtaining similar information from the recruitment agency (or hirer).
Ultimately, you will see no changes to our service – we will be issuing the amended employment contract to confirm that we are applying this model.

For further information please feel free to contact the Liberty Bishop team.
Alternatively, you can follow this link for the full guidance from BIS on: http://www.bis.gov.uk/assets/biscore/employment-matters/docs/a/11-949-agency-workers-regulations-guidance.pdf

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