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Agency workers cannot be paid more to avoid equal terms of employment

23 March 2018

Regulation 5 of the Agency Workers Regulation 2010 (‘AWR’) states that an agency worker is entitled to the same basic working and employment conditions as if they had been directly recruited to their role after a 12 week qualifying period.

It is the responsibility of the agency employing the agency worker to pay the agency worker the correct amount of pay. Basic working and employment conditions include pay, duration of working time, night work, rest periods, rest breaks and annual leave.

The Employment Appeal Tribunal (‘EAT’) has recently held in Kocur v Angard Staffing Solutions Limited (1) and Royal Mail Group Limited (2) that an agency worker who satisfied the 12 week qualifying period could not be paid a higher rate of pay to avoid giving them equal terms in relation to holiday entitlement and unpaid rest breaks compared to employees who had been hired directly by the hirer.

Mr Kocur was employed by the 1st Respondent, Angard Staffing Solutions Limited, and his services were supplied to the 2nd Respondent, Royal Mail Group Limited (‘Royal Mail’) as an agency worker on a regular basis. After completing 12 weeks with Royal Mail, it became apparent to Mr Kocur that he was not being provided with the same holiday entitlement and length of paid breaks as direct employees. He was given a one hour lunch break but was only paid for 30 minutes of it whereas direct employees were paid for the entire hour. Similarly, Mr Kocur was also only entitled to 28 days annual leave in comparison to the direct employees receiving 30.5 days. There were further issues in that Mr Kocur was not provided with a swipe card for accessing premises nor was he entitled to membership of an on-site fitness centre. Mr Kocur raised a grievance with each Respondent. The issues raised in the grievance were not sufficiently dealt with by the Respondents and he brought a claim in the Employment Tribunal (‘the ET’) for various breaches of the AWR.

The ET held that although the Respondents had infringed the Claimant’s rights under AWR in respect of access to facilities, his complaints regarding annual leave and payment for rest breaks were dismissed due to the fact that Mr Kocur had been receiving a higher amount of pay than the direct employees.

Mr Kocur subsequently appealed the decision to the EAT submitting that the ET’s approach in accepting that an enhanced hourly rate of pay could compensate for the difference in annual leave entitlement and rest breaks was wrong because it fails to give effect to the plain words of the AWR.

The EAT agreed with Mr Kocur and upheld the appeal. The EAT held that there was clearly a disparity as to the amount of leave and the failure to provide the additional 2.5 days’ to Mr Kocur meant that there was a breach of Regulation 5 as “‘the amount of leave is one of the terms and conditions relating to leave and must satisfy the requirement that it be at least equivalent to the amount of leave to which employees are entitled”. The EAT further held that the failure to provide the additional leave could not be “compensated for” by an enhanced hourly rate.

In relation to the rest breaks, the EAT also held that ”Regulation 5 requires that the terms and conditions relating to rest breaks be the same. That would include the terms as to payment for the rest break”.

Comment:

This case is a useful reminder to hirers of the importance of providing agency workers who have reached the 12 week qualifying period with the same basic terms and conditions of that of a direct employee. Employers and hirers cannot avoid meeting the requirements of the AWR, and particularly Regulation 5, by paying a higher hourly rate.

By Emily Jones

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