December 13, 2016
Balancing flexibility with fair treatment for agency workers
Building flexibility into your workforce and maintaining equal and fair treatment for workers can be a tricky balance to strike.
Here we look at the use of agency workers and how to work with them safely and in line with the latest regulations.
Spotlight swings from zero hours to agency workers
There are concerns an increasingly flexible labour market is creating an insecure workforce who are vulnerable to mistreatment. There has been a lot of attention on the use of zero hour contracts in the workplace, but a new report from The Resolution Foundation (December 2016) now puts the spotlight on the use of agency workers.
Information from the ONS Labour Force survey says agency workers in the UK have grown by 30%, or 200,000, since 2011 – and they believe it is set to grow further to 1,000,000 by 2020.
However, with this growth comes disadvantages for agency workers, including:
- Less pay than those working on a full-time permanent contract directly employed – an average of 22p an hour/£430 a year less, and up to 45p an hour less for permanent agency workers
- Reduced employment rights, for example no entitlement to sick pay or parental leave pay, no notice period, and reduced rights in the event of dismissal
- Lack of job security – leaving agency workers unable to plan ahead and know their income with no fixed hours
So it’s fair to say agency workers have problems too, just like their better-publicised colleagues on zero hour contracts.
What’s the difference between zero hour contract and agency workers?
The key difference from a zero hour contract worker is that an agency worker is not directly employed by the firm they are carrying out work for.
They are actually employed by an agency, and are often referred to as ‘temps’ beacuse the traditional use of agency workers is for short term or temporary work.
However, half of the agency workers in the report say they work on a permanent basis, with three quarters working full-time.
With agency workers occupying what could be permanent roles this, like the use of zero hour contracts, increases the amount of insecure work for individuals. And while there are some individuals who like the flexibility and variety of working via an agency, the report states that 59% of temporary agency workers would rather be in a permanent role. This shows that the majority of these workers are taking agency employment out of necessity, rather than choice.
The report also highlighted that agency workers are not only young people looking for temporary employment but includes a high number of older, full time, permanent workers.
Adhering to The Agency Worker Regulations (2010)
These regulations came into force in October 2011 and give agency workers the right to the same access to facilities like staff canteens, childcare provision and work related transport as a comparable employee.
They also are entitled to be informed about job vacancies. After a 12-week qualifying period, agency workers are entitled to the same basic conditions of employment as if they had been directly employed by the hirer on day one of the assignment.
This specifically covers pay (including any fee, bonus, commission, or holiday pay relating to the assignment) but does not include redundancy pay, contractual sick pay, and maternity, paternity or adoption pay.
Yet, despite these requirements being in place for five years they are falling short in ensuring equal treatment for agency workers.
As the UK already has a large and flexible workforce an additional clause was added that allows agencies to offer workers a ‘pay between assignments’ contract.
In return, the agency worker gives up their right to equal pay with comparable employees at the company where they are working. This ‘pay between assignments’ contract should give a continuous income stream to agency workers. Unfortunately, less trustworthy agencies have utilised loopholes.
Flexible focus may lead to tougher employer laws
There will always be a need for employers to have flexibility in the workforce to ensure smooth business operations but there needs to be a balance between the rights of the agency workers and the needs of the business.
If you’re an employer with a high use of agency workers, be aware taht this focus could result in future changes if the government decides to toughen the law to guarantee the fair treatment of these individuals through the statute book.