Temporary and Agency Workers (Equal Treatment) Bill

Temporary and Agency Workers (Equal Treatment) Bill

The Temporary and Agency Workers (Equal Treatment) Bill 2008 was a bill, introduced in the British parliament, designed to secure equal pay and terms for working time between vulnerable agency workers and their permanent staff counterparts. It was introduced by a private member, Labour backbencher Andrew Miller MP and would have formed an important part of the United Kingdom agency worker law, and an addition to the growing categories of employment discrimination law in the UK. The Bill's substance is modelled on a proposed European Directive, which has been blocked by the UK government since 2002. However the government has recently indicated that it will introduce a modified version of the Bill, with a 12 week (3 month) waiting period before agency workers will get equal pay and working time conditions.

The bill has been supported by a majority of the Labour Party, and trade unions, and vigorously opposed by the Conservative Party and the CBI. The calls for legislation have been bolstered by the particularly vulnerable position of people who work for agencies. They lack almost all of the rights guaranteed for normal workers from the Employment Rights Act 1996. However the legislation does not seek to make any but minor alterations for the position of agency workers on this front.


The Temporary and Agency Workers (Equal Treatment) Bill is a private member's bill, introduced by Andrew Miller MP in February 2008, and has currently passed its Second Reading in the House of Commons. This obliges employers to treat agency workers and permanent staff equally in their contract terms on (cl.1 read with cl.5),

*Hours and holiday time
*Pay, including sick pay
*Time off for parenting (for women only)
*Discrimination law (though this is unnecessary because agency workers are already explicitly covered in existing laws [Sex Discrimination Act 1975 s.9; Race Relations Act 1976 s.7; Disability Discrimination Act 1995 s.12; Equality in Employment (Religion or Belief) Regulations 2003 r.8; Equality in Employment (Sexual Orientation) Regulations 2003 r.8.] )

While representing significant change, the Bill does not change agency workers' vulnerability to being fired at the will of the employer. The courts are in two minds about which agency workers should be considered "employees" (under s.230 ERA). Usually they are not, and confusion in the courts both encourages more claims, and prevents the enforcement of clear rights. Agency workers have almost none of the main rights under the Employment Rights Act 1996. So the Bill does not include, in particular,

*Right to reasonable notice before dismissal (s.86 ERA)
*Right to written statement of contract (s.1 ERA, these two rights form the bedrock of individual labour law, since they were the first national minimum standards to be introduced in the Contracts of Employment Act 1963)
*Right to request flexible working time (s.80F)
*Right to parental and paternity leave (in Part VIII)
*Right to redundancy payments (s.135)
*Compensation from the government for lost earnings when an employer goes insolvent (s.182)

In cl.4(1) the Bill does create a right to have access to an Employment Tribunal under s.111 ERA 1996. This gives any person the right to bring an unfair dismissal claim against an "employer", and the Bill expressly provides in cl.4(2) that for this purpose both the agency and the end-user are employers. However, in an action for unfair dismissal, the claimant would need to should that an employer had (unsurprisingly) in some way acted "unfairly" (s.98 ERA 1996). The way people demonstrate "unfairness" is to show that some pre-existing right has been breached. If an agency worker is not considered an "employee" then he will probably not be able to rely on the ERA 1996 rights which require it. So while the rights in the proposed TAW(ET) Bill would be effective, those in the ERA remain ineffective.


The Bill is modelled, more or less directly, on the proposals put forward by the European Commission for a draft Temporary Agency Worker Directive ( [http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:52002PC0149:EN:HTML COD 2002/0149] ). This proposal was itself shelved, because of the UK government's consistent opposition to agency regulation, in the interests of labour market flexibility. According to newspaper reports, [see, Carl Mortished, ‘UK turns against EU merger law in deal with Germany,’ "The Times", 19 May 2003. According to the report, "The Commission is hoping to have the Takeover Directive passed with Mediterranean support but Germany wants a compromise to strip the law of key articles that prevent management using takeover defences and poison pills without prior authorisation. The UK Cabinet is believed to have abandoned support for the free market principle and, instead, formed an alliance with Germany in return for its support in wrecking the Temporary Agency Workers Directive. "The Brits have sold the City down the river," a source close to the talks said. Britain has been fighting a desperate battle to prevent the introduction of rules that give temps the same employment rights as full-time workers."] the UK got the backing of Germany to torpedo the draft Directive in return for the UK to help sink the Takeover Directive (Germany has comprehensive agency work regulation under its [http://de.wikipedia.org/wiki/Arbeitnehmer%C3%BCberlassungsgesetz "Arbeitnehmerüberlassungsgesetz"] and its Civil Code, esp §622, and the UK has strong Takeover Regulation, especially Rule 21 of the City Code [for interesting discussion, see David Kershaw, [http://journals.cambridge.org/production/action/cjoGetFulltext?fulltextid=1535604 'The Illusion of Importance'] (2007) 56 "ICLQ" 267] ). The significant difference between the proposed Directive and the Bill is that the former UK government managed to insert a 6 week qualification period in the Directive before the equal treatment rights click in (Art. 5(4)). The Bill has no proposed qualification period, though voices in the City have been calling for this to be one year. The latest reports suggest a 12 week qualifying period has been agreed between the private MP backers and the government, meaning a significant step back from the protection the Directive would offer. The Directive included equal treatment only pay, hours, parental rights and anti-discrimination (Art. 3(1)(d)). A significant omission therefore was any regulation on reasonable notice before dismissal (in the UK, ERA s.86; Germany has this for all workers already, regardless of their agency status, §622 BGB).

Before the United Kingdom general election, 2005, the trade unions and the government made the so called Warwick Agreement (after its signing place, the University of Warwick). This included a promise on the government's part to reverse its opposition to the European Directive. But by 2007, the government was yet to deliver, and Paul Farrelly MP introduced the Temporary and Agency Worker (Prevention of Less Favourable Treatment) Bill. It mirrored the Directive in all respects, save that there would be no 6 week qualifying period. In that period's climate, the Bill did not gain enough attention and was talked out of time. In the Court of Appeal case "James v. Greenwich LBC" ["James v. Greenwich LBC" [2008] [http://www.bailii.org/ew/cases/EWCA/Civ/2008/35.html EWCA Civ 35] ; See the judgment by Elias J in the EAT, "James v. Greenwich LBC" [2006] [http://www.bailii.org/uk/cases/UKEAT/2006/0006_06_1812.html UKEAT/0006/06] ] which further entrenched the subordinate position of agency workers, [see especially, this summary from Counsel for the employer who won the case, Jonathan Cohen at Littleton Chambers, [http://www.littletonchambers.com/Judgement-Details.aspx?judgementID=358 Judgement details] (19.02.08)] Mummery LJ pronounced it "doomed to failure for lack of support from the Government". But no sooner as that had been said, almost exactly the same Bill was reintroduced by Andrew Miller MP, with a small title change to emphasise "Equal Treatment" rather than "Prevention of Less Favourable Treatment". Identical in every way, save a tighter definition of employment agency and more provision for regulatory enforcement, it won the support of almost the whole Labour bench in the House of Commons. It was being heard in Committee each Wednesday morning as from May 7th. As of May 21st, the government has signalled that it will allow something similar to the Bill, but not the Bill itself, to be passed. It will incorporate a 12 week waiting period before the right to equal pay and time off begins, or 6 weeks less protection than the original 2002 Directive. [Patrick Wintour, [http://www.guardian.co.uk/politics/2008/may/21/tradeunions.gordonbrown 'Agency and temporary workers win rights deal'] , "The Guardian", (21.5.2008)]

Annotated text

cquote|A Bill To provide for the protection of temporary and agency workers; to require the principle of equal treatment to be applied to temporary and agency workers; to make provision about the enforcement of rights of temporary and agency workers; and for connected purposes. Be it enacted by the Queen’s most Excellent Majesty, by and with the advice and consent of the Lords Spiritual and Temporal, and Commons, in this present Parliament assembled, and by the authority of the same, as follows:— ;1 Equal treatment of agency workers(1) An agency worker has the right not be treated by the employment business, or employment agency, or by the end user less favourably in respect of his basic working and employment conditions [These are defined in Clause 5 of the bill to include pay, hours, the law relating bringing up kids, and discrimination.] than a comparable direct worker is or would be treated.

(2) Subsection (1) above applies only if—

:(a) the treatment is on the ground that the worker is an agency worker, and

:(b) the treatment is not justified on objective grounds.

(3) In determining whether the right conferred by subsection (1) has been breached, the pro rata temporis principle applies where appropriate.

;2 Comparable direct workers(1) For the purposes of this Act, a direct worker is a comparable direct worker in relation to an agency worker if, at the time when the treatment that is alleged to be less favourable to the agency worker takes place—

:(a) the other party to the direct worker's contract is the end user in respect of the agency worker;

:(b) both the direct worker and the agency worker are engaged in the same or broadly similar work, having regard, where relevant, to whether they have a similar level of seniority, qualification and skills; and

:(c) the direct worker works or is based at the same establishment as the agency worker or, where there is no comparable direct worker working or based at that establishment who satisfies the requirements of paragraphs (a) and (b), works or is based at a different establishment and satisfies those requirements.

(2) For the purposes of subsection (1), it is immaterial whether the direct worker's contract is of open-ended or fixed duration.

(3) Where no real comparable direct worker can be identified, [The use of a "hypothetical comparator" is a chief strength of the Bill. It is also found in discrimination, but not in the law on Fixed and Part time employees, which has limited their effect.] a tribunal considering a complaint under section 1(1) shall consider how a comparable direct worker satisfying the requirements of subsection (1) would have been treated having regard to all the circumstances of the case, including—

:(a) any relevant collective agreements;

:(b) the terms and conditions of direct workers;

:(c) the usual practices of the employment business, or employment agency, and the end user; and

:(d) the treatment of other direct workers or other former direct workers, as may be relevant.

;3 Access to direct employment and protection from unfair treatment(1) An end user shall inform all agency workers provided to him of any vacancies for work as a direct worker in his undertaking.

(2) Any clause of any contract between an employment business, or employment agency, and—

:(a) an agency worker, or

:(b) an end user,

is void and of no effect insofar as it prohibits, prevents, or has the effect of preventing, an agency worker becoming a direct worker of the end user. [It would be possible for the courts to interpret this restrictively. Instead of meaning clauses in a contract which "hinder" an agency worker getting a permanent job, they could view this to mean "prevents outright" from getting a permanent job. This would matter, for instance, in the case of a worker whose agency has a six month notice period before any permanent job is offered. The point for the agency would be to restrict the worker and employers' freedom to deal with one another, so as to keep a percentage of the worker's salary on their books for as long as possible.]

(3) An agency worker who is an employee within the meaning of section 230(1) of the 1996 Act and who is dismissed (whether by the end user or the employment business, or employment agency) shall be regarded as unfairly dismissed for the purposes of Part 10 of the 1996 Act if the reason (or if more than one, the principal reason) for the dismissal is a reason specified in subsection (5). [The effect of this clause is to prevent "victimisation" for even thinking of bringing any kind of action against an employer. It is found in most other discrimination legislation.]

(4) An agency worker has the right not to be subjected to any detriment by any act, or any deliberate failure to act, of the end user or the employment business, or employment agency, done on a ground specified in subsection (5).

(5) The reasons or, as the case may be, the grounds are—

:(a) that the agency worker—

::(i) brought proceedings against the end user or the employment business, or employment agency, under this Act;

::(ii) gave evidence or information in connection with such proceedings brought by any person;

::(iii) otherwise did anything under this Act in relation to the end user or the employment business, or employment agency;

::(iv) alleged that the end user or the employment business, or employment agency, had infringed this Act; or

::(v) refused (or proposed to refuse) to forgo a right conferred on him by this Act, or

(b) that the end user or employment business believes or suspects that the agency worker has done or intends to do any of the things mentioned in paragraph (a).

(6) Subsection (4) does not apply where the detriment in question amounts to a dismissal within the meaning of Part 10 of the 1996 Act which falls within subsection (3). [This clause's effect is simply to say that the proper action, if someone is dismissed, is one for unfair dismissal, not victimisation. However two separate actions could be brought if victimisation was separate and prior to a dismissal.]

;4 Complaints to employment tribunals, enforcement etc(1) The Secretary of State shall by regulations provide for the enforcement before an employment tribunal of the rights afforded to agency workers by sections 1(1), 3(1) and 3(4), the said regulations to include provision for—

:(a) the right to present a complaint to an employment tribunal;

:(b) joint and several liability for any compensation ordered by the employment tribunal as between the employment business and the end user in respect of complaints under sections 1(1) and 3(4);

:(c) the territorial extent of the rights;

:(d) secondary liability;

:(e) the applicability of the rights to special classes of employment;

:(f) the necessary and consequential amendment of legislation.

(2) The regulations providing for enforcement under subsection (1) may include provision for—

:(a) the appointment of a regulatory authority with suitable duties and powers for the purpose of enforcing the rights afforded to agency workers by sections 1(1), 3(1) and 3(4);

:(b) the appointment of statutory officers with suitable duties and powers for the purpose of enforcing the rights afforded to agency workers by sections 1(1), 3(1) and 3(4);

:(c) alternative dispute resolution, including the referral of proceedings brought before an employment tribunal for a period not exceeding 28 days, or longer with the agreement of the parties.

(3) For the purposes of sections 3(3), 3(4) and 111 of the 1996 Act, both the employment business, or employment agency, and the end user—

:(a) shall be deemed to be the employer of the agency worker; and

:(b) shall have joint and several liability for any award of compensation that might be ordered in respect of such a complaint.

(4) Section 203 of the 1996 Act (restrictions on contracting out) shall apply in relation to this Act as if the provisions of this Act were contained in the 1996 Act.

;5 InterpretationIn this Act—“the 1996 Act” means the Employment Rights Act 1996 (c. 18);

“agency worker” means any person who is supplied by an employment business, or employment agency, to do work for another person (“the end user”) under a contract or other arrangements made between the employment business, or employment agency, and the end user;

“basic working and employment conditions” means working and employment conditions relating to—

:(a) the duration of working time, rest periods, night work, paid holidays and public holidays;

:(b) pay, including sick pay;

:(c) work done by pregnant women and nursing mothers, children and young people; and

:(d) action taken to combat discrimination on the grounds of sex, race or ethnic origin, religion or beliefs, disabilities, age or sexual orientation;

“comparable direct worker” shall have the meaning set out in section 2;

“direct worker” means an individual, not being an agency worker, who has entered into or has worked under—

:(a) a contract of employment; or

:(b) any other contract, whether express or implied and (if it is express) whether oral or in writing, whereby the individual undertakes to do or perform personally any work or services for another party to the contract whose status is not by virtue of the contract that of a client or customer of any profession or business undertaking, or employment agency, carried on by the individual;

“employment” means employment under a contract of services or a contract personally to execute any work or labour, and related expressions shall be construed accordingly;

employment agency” means the business (whether or not carried on with a view to profit and whether or not carried on in conjunction with any other business) providing services (whether by the provision of information or otherwise) for the purpose of finding workers employment with employers or of supplying employers with workers for employment by them;

“employment business” means the business (whether or not carried on with a view to profit and whether or not carried on in conjunction with any other business) of supplying persons in the employment of theperson carrying on the business, to act for, and under the control of, other persons in any capacity;

“end user” shall have the meaning ascribed within the definition of “agency worker” within this section;

joint and several liability” shall be construed with reference to the Civil Liability (Contribution) Act 1978 (c. 47);

“the pro rata temporis principle” means that where a comparable direct worker receives or is entitled to receive pay or any other benefit, an agency worker is to receive or be entitled to receive not less than the proportion of that pay or other benefit that the number of his weekly hours bears to the number of weekly hours of the comparable direct worker.

;6 Short title, commencement and extent(1) This Act may be cited as the Temporary and Agency Workers (Equal Treatment) Act 2008.

(2) Subject to subsection (3), the provisions of this Act shall come into force on such day as the Secretary of State may by order made by statutory instrument appoint; and different days may be appointed under this subsection for different purposes.

(3) The day or days specified by the Secretary of State under subsection (2) shall not be later than 1 October 2009.

(4) This Act extends to England, Wales, Scotland and Northern Ireland.

ee also

*UK labour law
*UK agency worker law
*Employment Agencies Act 1973
*Gangmasters (Licensing) Act 2004
*Employment Agency Standards Inspectorate


External links

*Proposed directive on Agency workers [http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:52002PC0149:EN:HTML COD 2002/0149]
** [http://www.publications.parliament.uk/pa/cm200708/cmbills/027/08027.i-i.html Temporary and Agency Workers (Equal Treatment) Bill 2007] , a proposal which has currently (13/3/2008) passed its second reading. Here is the Bill in a [http://www.publications.parliament.uk/pa/cm200708/cmbills/027/2008027.pdf pdf file]

*Directive [http://europa.eu.int/eur-lex/lex/LexUriServ/LexUriServ.do?uri=CELEX:31997L0081:EN:HTML 97/81/EC] on Part time workers
**Implemented under Part-time Workers (Prevention of Less Favourable Treatment) Regulations 2000, [http://www.opsi.gov.uk/si/si2000/20001551.htm SI 2000/1551]

*Directive [http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:31999L0070:EN:HTML 99/70/EC] on Fixed term workers
**Implemented under Fixed Term Employees (Prevention of Less Favourable Treatment) Regulations 2002, [http://www.opsi.gov.uk/si/si2002/20022034.htm SI 2002/2034]

* [http://www.atsco.org/files/ATSCoPresentation020507-DenisPennel.ppt Powerpoint presentation] on the state of the EU market from the European Confederation of Private Recruitment Agencies.

*Directive [http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:31991L0383:EN:HTML 91/383/EEC] of 25 June 1991 supplementing the measures to encourage improvements in the safety and health at work of workers with a fixed- duration employment relationship or a temporary employment relationship.

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