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Business Must Ready Itself For New Temporary Worker Rights- 07/07/2011
Employers have to be ready for to deal with new regulations controlling the rights of temporary workers from 1 October 2011, or face having to pay unlimited compensation and penalties of up to £5,000, warns a leading Wolverhampton employment solicitor.
Tracy Worthington, Partner and Head Employment Department at FBC Manby Bowdler LLP, says that the new Agency Workers Regulations 2010 balance up permanent and temporary worker rights and benefits and is advising employers to carry out a complete review of their practices now in order to help control the increased costs that will follow.
Mrs Worthington says: “The Wolverhampton and Black Country economy could be particularly heavily hit as these new regulations could have a massive impact on any business which uses agency workers, in particular those in manufacturing and retail, that commonly use agency labour to manage seasonal fluctuations in demand.”
After 1st October any workers supplied by a temp agency who have worked for 12 weeks with the same company, will become entitled to the same rights and benefits as workers hired directly by the company.
This means that they will be entitled to the same wages or salary, the same overtime payments and annual pay increases and the same holidays and rest breaks as permanent workers of a similar grade hired directly by the company. Also, temps will be entitled to certain benefits, such as use of the canteen and crèche from day one, although the agency workers will not be entitled to join the company’s pension scheme or to redundancy payments.
According to Mrs Worthington, in some sectors, agency workers are temporary workers who are called in to provide holiday or sickness cover for a few days, but in other sectors agency workers are used extensively to provide a flexible work force and the word ‘temp’ in this context is a misnomer.
She says: “Businesses in these sectors will need to review their policies and either change the way they meet their staffing needs or bite the bullet and be ready to absorb increased costs, and it’s a Government estimate that these could be as high as £1.8 billion per year for UK business.
“In fact all employers will need to act fast if they have not yet made preparations to comply with the regulations. They must look at their employee benefits and consider which are covered by the regulations and which are excluded. If they rely on agency workers to a substantial extent they must look at how they comply and what the cost of compliance will be.
“With planning, there are ways that companies can take charge of the situation. For example, they could decide to change what is offered to permanent employees, but what they cannot do is to move agency workers between different jobs or to change their job description every 12 weeks. These are obvious ruses that are prohibited and will attract a fine of up to £5,000.”
With 33 partners, FBC Manby Bowdler is one of the largest law firms in the West Midlands. In addition to Wolverhampton, the firm also has offices in Willenhall, Telford, Shrewsbury and Bridgnorth.