Agency Workers Regulations (AWR)

For contractors working through a recruitment agency, understanding legislation is essential to remain compliant and in control.

The Agency Workers Regulations (AWR) were introduced in 2011 as a measure to protect agency workers by granting them the same rights as employees. We’ve looked at AWR and what this could mean for you.

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What is an agency worker?

The term 'agency worker' is used to refer to an individual who is either:

  1. Supplied by a temporary agency. Temporary workers must have an agreement or contract to carry out work for their hirer and work under their supervision and direction.
  2. A worker who supplies their service through an umbrella company (known as an intermediary). These workers will have an employment contract with the umbrella company.

A genuine self-employed individual will not be classed as an agency worker, so these rules will not apply to them.

What are the Agency Workers Regulations?

The Agency Workers Regulations (AWR) came into effect on the 1st October 2011. It protects temporary workers hired through an agency or those working through an umbrella company. Temporary workers and contractors working through their own limited company are unaffected by AWR.

The AWR legislation ensures that any temporary worker working for a company after 12 weeks in the same job role will have the same working conditions as a permanent employee in the same job. This means that temporary workers will benefit from a whole host of employee benefits from their employers.

As a result, after 12 weeks in the same role, temporary workers must be treated to the same terms and conditions relating to pay as a permanent member of staff.

However, the following are excluded from AWR:

  • Sick pay
  • Loyalty bonuses
  • Pensions
  • Maternity pay
  • Redundancy payments

Who is affected by the Agency Workers Regulations?

AWR only impacts contractors who are not operating through their own limited company.

The table below shows if you would be affected by the scheme:

State of individual

Affected by Agency Workers Regulations?

Supplied by temporary work agencies

Yes

Supplied by intermediaries, e.g., umbrella companies

Yes

Limited company contractors

No

What does AWR mean for me?

Once you have completed the qualifying period of 12 weeks, you are entitled to find out about basic terms and working conditions. Typically, you will first approach your agency, which will have 28 days to inform you of these terms and conditions. If, after 28 days they have not responded, you can ask your employer directly, who then has 28 days to reply. If, after 28 days no information has been provided, you can take both parties to an industrial tribunal.

There is no maximum limit to successful claimants. Still, a minimum of two weeks' pay should normally be awarded by the tribunal in relation to a failure to provide equal terms and conditions.

Do employers have to participate in AWR?

Employers under AWR legislation have no choice if they participate or not. If they do try to avoid the 12-week qualifying period by rotating agency workers and changing assignments to ensure they do not meet the 12-week qualifying period, they will face fines of up to £5,000.

What happens if I change agencies in between my 12-week period?

Nothing. If you were in the same role but re-hired by a different agency within this timeframe, you would still be entitled to the 12-week agency workers' regulations. If, however you changed agency and your temporary role was different, you would not apply for the 12-week AWR rule.

Does AWR impact me if I hire subcontractors?

If you are a contractor, AWR will not impact you if you are legitimately in business on your own account. However, if you provide contractors to clients to undertake work, this legislation will impact them.

Find out more

Do you have any questions regarding AWR? Request a callback and a member of our team will be in touch.

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How can SJD Accountancy help?


Appointing an accountant can save you time and stress when starting up on your own. If you would like to speak to someone about any of the above information or any other queries you may have, arrange a callback and a member of the team will be in touch.

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