Historically, agency workers (also known as ‘temps’) had limited protections compared to employees and other workers. However, this has changed significantly in recent years. The introduction of the Agency Workers Regulations 2010, which came into force in the UK in 2011, marked a significant step towards ensuring fair treatment for temporary workers supplied by recruitment agencies. These Regulations, along with other employment laws, now offer agency workers greater rights and protections.
Consequently, organisations that rely on agency workers need to be aware of their legal responsibilities. In this article, we outline the main workplace rights of agency workers in the UK and explain what these mean for employers.
What is an Agency Worker?
An agency worker is an individual supplied by a temporary work agency to perform work under the supervision and direction of a hiring organisation, typically, on a short-term or flexible basis.
Importantly, most agency workers are not employees of the organisation where they are placed; instead, their contractual relationship is with the employment or recruitment agency, which is also responsible for paying them. Agency workers play an important role in providing flexibility and meeting fluctuating workforce demands for businesses.
The Agency Workers Regulations 2010 (the ‘Regulations’) grant specific rights to agency workers. Some of these rights apply from the first day of an assignment and are known as ‘day one’ rights. Other rights only come into effect after the worker has completed 12 continuous weeks in the same role with the same hiring organisation. Once this 12-week qualifying period is met, agency workers are legally entitled to equal treatment regarding basic pay and working conditions compared to directly employed staff in similar roles.
In addition to the rights granted under the Regulations, agency workers are also protected by a range of general employment rights available to all workers under UK employment law.
Agency Workers vs Employees: What’s the Difference?
An agency worker typically has a contract for services with an employment agency. Although they perform work for the hirer, they are generally not considered employees of either the agency or the hirer. As a result, they do not receive the full range of employment protections. In particular, agency workers usually do not have:
- The right to notice when an assignment ends,
- The right to claim unfair dismissal, or
- Entitlement to redundancy pay.
By contrast, someone with a contract of employment enjoys a much broader set of statutory employment rights and protections.
Despite not being employees, agency workers are usually classified as “workers”, which gives them access to some important legal protections. These include the right to national minimum wage, holiday pay, working time protections, protection against discrimination and the right to equal pay and basic working conditions after 12 weeks in the same role.
Notice Periods for Agency Workers
Understanding the rules around notice and termination is important for businesses that rely on agency workers.
For agency workers, notice obligations arise solely from the terms of their contract with the employment or recruitment agency. Because agency workers operate under contracts for services, rather than contracts of employment, they are not treated as employees of the hiring organisation. As a result, they do not benefit from the statutory right to notice under the Employment Rights Act 1996. Likewise, agency workers generally do not need to give notice to end an assignment.
However, if the contract includes a notice clause, both the agency and the worker must comply with it. In practice, many agencies include a short notice period, typically around one week, to allow for a smooth handover and continuity of work. Where a notice clause is present, the assignment can usually be terminated immediately by either party, provided the worker is paid for all hours worked up to the point of termination.
What Happens If An Agency Worker Leaves an Assignment Early?
If an agency worker ends an assignment early without providing the required notice, this could be seen as a breach of contract, which may allow the agency to withhold pay for the unworked notice period or, in rare cases, claim limited damages. However, such claims are uncommon.
In situations where there is no contractual notice requirement, the agency worker can generally leave the assignment without notice, and the agency can also terminate the placement without prior notice. In these circumstances, there is normally no legal penalty for leaving early. However, doing so may affect the worker’s professional reputation and future opportunities for placement with the same agency or client.
From the hirer’s viewpoint, if an agency worker leaves mid-assignment, the contract between the hirer and the agency will govern what happens next. Usually, the agency is responsible for supplying a suitable replacement, and the hirer has no direct contractual claim against the worker.
Hirer Obligations
The hiring organisation is not legally obliged to give notice to end an agency assignment unless the contract or terms of business with the agency specify a notice period. In such circumstances, the hirer must act in line with its commercial agreement with the agency, which typically sets out short notice terms for ending a placement.
In the absence of a contractual clause, an assignment can usually be terminated immediately. Since the hirer has no direct employment relationship with the agency worker, there is no legal duty to provide notice to them. In practical terms, however, it is good practice for agencies and hirers to provide reasonable notice, even if not legally required, to promote fairness, maintain good relationships, and protect their reputation within the temporary staffing market.
What Rights Do Agency Workers Have?
From day one, agency workers are entitled to basic rights such as:
- Work hours, rest periods and rest breaks under The Working Time Regulations 199
- A minimum paid holiday entitlement
- Protection from discrimination
- All health and safety protection
s - Notification of job vacancies
- An itemised payslip.
- National minimum wage
- Access to the onsite facilities (for example, creche, canteen, onsite gym, etc.)
Holiday Entitlement and Bank Holidays
From day one of the assignment, agency workers are entitled to a minimum of 5.6 weeks of paid annual leave, which is equivalent to 28 days for someone working a full five-day week. Agency workers are not automatically entitled to have bank holidays off or receive pay for them, but bank holidays may be included within this 5.6-week entitlement, meaning the agency worker must take paid holiday to cover them.
Holiday entitlement accrues from the start of the assignment and is calculated pro rata based on the worker’s hours. The method used to calculate holiday pay depends on the working pattern:
- Fixed Hours: The worker receives holiday pay at their normal rate of pay
- Irregular hours: Holiday pay is calculated at 12.07% of the pay received in each pay period (based on 5.6 weeks of holiday for 52 working weeks minus 5.6 weeks of statutory leave).
Agency workers working irregular hours can either receive holiday pay at the time the leave is taken, or, if agreed, holiday pay may be ‘rolled up’ and paid at the same time as the regular wages for that pay period, rather than waiting until the worker takes a holiday.
After the 12-week qualifying service is reached, however, an agency worker will also be entitled to the same holiday entitlement (pro-rata to their hours) as a comparable employee hired directly by the hiring organisation. This means that they will also be entitled to any contractual paid holiday over and above the statutory minimum holiday entitlement.
Similarly, after qualifying for equal treatment after 12 weeks’ service, an agency worker should be treated in the same way as direct employees when it comes to holiday requests and taking annual leave. However, if an agency worker wants to request leave, they should send an initial request to their agency consultant as well as inform their workplace line manager.
At this point, the agency worker will also be entitled to equal treatment in respect of enhanced pay for working on bank holidays or public holidays, and the right to paid time off on bank holidays or public holidays.
While it is the agency’s responsibility to ensure that its workers receive their full paid holiday entitlement, the hiring organisation should cooperate with the agency in granting time off where it is requested.
Pregnancy, Maternity, Paternity and Parental Rights For Agency Workers
As with other workers and employees, the Equality Act 2010 makes it unlawful to discriminate against an agency worker on the grounds that they are;
- Pregnant
- Given Birth (in the last six months)
- Breastfeeding
Pregnancy Rights
Furthermore, as per the law, all agency workers have the right to a safe environment from day one of their placement. If an agency worker has notified the agency of her pregnancy, the hiring organisation should carry out an individual risk assessment to consider any pregnancy-related risks. If these do exist, the hiring organisation should take reasonable action to eliminate that risk by changing its working conditions or hours of work.
Maternity, Paternity and Parental Rights
Agency workers who are not classified as employees are not entitled to maternity leave and the rights associated with it unless it is specifically stated in their contract. Similarly, they are generally not entitled to paternity, adoption or shared parental leave. This is because these rights are also typically tied to employee status, which many agency workers do not have. However, they can still stop working to care for their child, although they should inform the agency in advance.
During this time, they may qualify for statutory maternity pay (‘SMP’), maternity allowance (which is paid to those who don’t qualify for SMP, including the self-employed, recent employees or those who don’t meet the minimum earnings or employment length requirements for SMP), statutory paternity pay, statutory adoption pay or shared parental pay if they meet the minimum requirements on pay and the number of weeks they have spent working.
Sick Leave and Pay
If they are unwell and unable to work, agency workers are entitled to take sick leave, just like other workers and employees.
They will also be entitled to Statutory Sick Pay (SSP) so long as they have started their assignment and satisfy the eligibility requirements. However, they will not be entitled to any contractual or occupational sick pay.
Equal Treatment After 12 Weeks
Agency rights expand considerably after 12 weeks in the same role with the same hiring organisation. Following the 12-week qualifying period, an agency worker is entitled to the same basic terms and conditions of employment as if they had been directly employed by the hirer. This entitlement is established by the Agency Workers Regulations 2010 and guarantees that agency workers receive the same rights as their permanent colleagues regarding:
- Pay
- Annual leave
- Work patterns and rest breaks
- Pension rights
- Pregnancy rights, such as time off for antenatal and adoption appointments
The 12-week period starts on the first day of the assignment and is based on being in the same role with the same hirer. Certain types of leave, such as sickness leave, can count towards the 12 weeks.
Equal Pay
After 12 weeks in the same role, agency workers become entitled to the same basic working and employment conditions as a comparable permanent employee doing the same job. This includes:
- Basic Pay
- Overtime Rates
- Shift Allowances
- Annual Pay Increases
- Holiday Pay
- Performance-Related Bonuses or Commission
This does not mean that an agency worker must receive identical pay to a permanent employee, but any difference must be supported by a fair and objective reason, for example, the permanent employee may have greater experience or additional responsibilities.
The right to equal treatment does not cover:
- Enhanced or contractual sick pay (agency workers are eligible only for statutory sick pay (SSP), provided they meet the eligibility requirements)
- Occupational pension schemes
- Enhanced maternity, paternity or adoption pay
- Redundancy pay
- Expenses
- Most benefits in kind
- Training allowances
- Long-service rewards
- Bonuses that are not directly linked to individual performance
Other Key Rights After 12 Weeks
After completing 12 weeks of continuous service in the same role, an agency worker becomes entitled to equal treatment in respect of key employment rights, such as:
- Working Time: Agency workers must receive the same working hours, work patterns, rest breaks, and rest periods as directly employed staff. This also covers entitlement to longer lunch breaks or any additional breaks offered by the hirer.
- Annual Leave: If the hiring organisation provides more than the statutory minimum of 5.6 weeks’ annual leave to its direct employees, the agency worker is entitled to the same enhanced holiday allowance and holiday pay.
- Pregnancy-Related Rights: Once the 12-week qualifying period is met, pregnant agency workers are entitled to paid time off for antenatal appointments and classes. Agency employees whose partner is expecting a child are eligible for unpaid leave to accompany them to antenatal appointments.
- Pension Enrolment: Agency workers must have the same access to the hirer’s workplace pension scheme as comparable permanent staff. They should be automatically enrolled if they meet the eligibility criteria. However, the Regulations do not prescribe a specific pension amount or minimum contribution level.
The hiring organisation is responsible for providing the agency with information about the relevant terms and conditions in their business so that the agency can ensure the agency worker receives equal treatment after 12 weeks in the same job.
Determining liability can be complex, as both the agency and the end user may be responsible for different aspects of non-compliance. The hiring organisation is at risk if it fails to meet its obligations, especially around day-one rights. Breaches of equal treatment can result in employment tribunal claims, financial penalties, and reputational damage.
Here To Help
Understanding the rights of agency workers is crucial for staying legally compliant and avoiding breaches of the Agency Workers Regulations. It also helps maintain good relationships with both workers and agencies.
If you would like advice or further information about agency workers’ rights and the implications for your business, please contactour expert Employment Law team on 0300 303 2071 or email us.
FAQ
Do agency workers get paid for bank holidays?
Agency workers have a statutory right to 5.6 weeks of paid annual leave, but this leave may be used to cover bank holidays. They are not automatically entitled to paid bank holidays unless their contract or agency policy says so.
After 12 continuous weeks in the same role, they are entitled to the same holiday rights as comparable permanent staff. If permanent employees receive paid bank holidays in addition to their annual leave, the agency worker should also receive them.
Do agency workers have to give notice?
Usually, agency workers are not required to give notice unless their contract includes a notice requirement. They can normally end an assignment without notice.
Do agency workers get redundancy pay?
Generally, agency workers are not entitled to redundancy pay. They are usually classed as workers, not employees, and only employees with two years’ continuous service with the same employer qualify for statutory redundancy pay.
Can agency workers claim unfair dismissal?
Most agency workers cannot claim unfair dismissal since this right applies only to employees with two years’ continuous service with the same employer. Most agency workers do not meet the legal definition of an employee.
Are agency workers entitled to maternity leave?
Agency workers do not qualify for statutory maternity leave; this right is generally reserved for employees. However, they may be eligible for Statutory Maternity Pay (SMP) or Maternity Allowance (MA) if they meet the relevant criteria.
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