Avoid paying twice when relying on agency advice
31 May 2019
As we have previously covered, under the Agency Workers Regulations 2010 employers who hire temporary workers via an agency should ensure that eligible agency workers benefit from the same basic terms and conditions as permanent employees, including equal pay.
The recent Court of Appeal decision of London Underground Ltd v Amissah and others provides helpful clarification that the Agency Worker Regulations provide eligible agency workers with an enforceable entitlement to receive the benefits of the same terms and conditions that a comparator non-agency worker would receive under his or her contract.
- After the Agency Workers Regulations came into force, some workers engaged by London Underground through an agency became entitled to the same rates of pay as workers employed directly.
- However, London Underground did not pay the correct pay rates to the agency until August 2012, when it realised its mistake and paid the arrears.
- The agency did not pass the back pay on to the workers before going into involuntary liquidation.
- The Court of Appeal decided it was not just and equitable to deprive the workers of compensation in the circumstances, as there was no question of any misconduct on their part.
- It was decided that London Underground chose to deal with the agency and therefore it should bear the burden of the agency’s actions. It was ordered to pay overall, 50% of the compensation to which the workers were entitled (despite already having paid it to the agency).
Following this case, hirers/end users should appreciate the importance of establishing as early as possible;
- Whether the Agency Worker Regulations 2010 apply to any workers;
- When the 12 week working period will expire; and
- Any workers who may fall outside of the Swedish derogation exception (where liability does not arise where there is a permanent employment contract with an employment business where workers are paid between assignments when not working for a hirer)
This is because as the Amissah case demonstrates, the hirer/end user will not necessarily escape liability if they have relied upon incorrect information provided by the agency.
In the above case, London Underground actually found itself having to pay twice, to compensate agency workers in a dispute over back pay where equalised pay ought to have been given.
If you have queries about the entitlements of any agency workers you are using, then please do get in touch. Please call us on 01243 836840 for a no obligation chat, or email us at [email protected].