Can you pay an agency worker more to compensate for less holiday and pay for breaks?

Agency workers are entitled to “the same” basic working and employment conditions as a direct hire once they have completed 12 continuous weeks in the same role with the same hirer. Equality of treatment relates to terms including pay, the duration of working time, rest breaks and annual leave. In Kocur v Royal Mail Group Ltd, an agency worker was supplied to carry out work at a mail centre in Leeds. The worker completed 12 weeks continuous service by June 2015, triggering his right to equal treatment. A grievance was raised in October 2015 about the worker’s pay and other conditions, including that he was getting shorter breaks than direct recruits. At the end of the procedure, his entitlement to breaks was changed. The agency worker made a claim to the tribunal for a breach of the Agency Worker Regulations (AWR) in relation to: a failure to be provided a swipe card to access the premises; not being provided the opportunity to join the on-site fitness centre; payment for rest breaks; and entitlement to annual leave. The employment tribunal found the employee’s rights had been breached by failing to provide him with a swipe card and access to the fitness centre. Although they found the employee was only paid for 30 minutes of a one hour break and was entitled to 5.6 weeks of annual leave, whereas a comparable direct employee was paid for the whole break and had 6.1 weeks’ annual leave, the tribunal judged there was no breach of the AWR. In their view, the disparities were compensated for by paying the agency worker more; he was paid £10.50 ph whereas direct recruits were paid £9.60 ph. On appeal, the Employment Appeal Tribunal (EAT) held “the same” basic conditions means the agency worker should receive “at least” the conditions direct employees of the end-user are entitled to. They also highlighted that the Regulations apply on a term-by-term basis and there is no law allowing a breach of the Regulations to be put right by providing a higher rate of pay. As the agency worker did not receive at least the same pay for his rest breaks or entitlement to annual leave as a comparable direct employee, the AWR were breached. What this means for employers:
  • A failure to provide agency workers with equal treatment after 12 weeks cannot be put right by providing the agency worker with a higher entitlement for one term, such as their pay, in relation to comparable direct employees
  • Once the agency worker reaches 12 weeks continuous service, the right to equal treatment kicks in. At this stage, their terms and conditions should be reviewed on a term-by-term basis to ensure they are not less favourable than a direct comparable employee’s conditions.
  • The requirement to provide agency workers with “at least” the conditions direct employees are entitled to means there is a minimum entitlement, but no maximum entitlement. This means there is no right to reduce an agency worker’s higher entitlement, such as higher pay, where it is necessary to increase another entitlement.

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