AWR: Strategy Development
Presented by Samantha HurleyAPSCo
28th September 2011
Outline
Overview of AWR & new rights Who is liable Who is inside & outside of Scope Pay between assignments model
(Swedish derogation) Impact and risk assessment
approach Key Points for strategy development
Overview of AWR
Purpose: to give the same basic working & employment conditions as if engaged directly
1st October 2011 – not retrospective Designed to protect vulnerable
workers Doesn’t confer full employment rights Provides new “Agency Worker”
employment status
Day One Rights
Equal access to:– collective facilities & amenities; and– information about relevant vacancies.
These are not enhanced access rights.
Less favourable access may be objectively justified
Equal Treatment Rights
12 week qualifying period– breaks either reset, pause, or continue QP– same role, same hirer
Same or substantively similar role Agency worker informed of new role Same hirer – dependent upon legal
entity Structure of assignments
Equal Treatment Rights
After 12 week qualifying period Basic working & employment conditions only Treat “as if” recruited directly to same role Can compare to pay scales, relevant collective
agreements, established practice Can make comparison between AW & existing
employee doing broadly similar work Unique roles AW still entitled to relevant terms, which
generally apply in the workplace
Equal Treatment Rights
Basic conditions: pay; duration of working time; night work; rest periods; rest breaks; & contractual annual leave (above statutory entitlement)
Pay includes: basic pay; overtime payments;
shift/unsocial hours allowances holiday pay bonus/commission attributable to work
done vouchers/stamps with a monetary value
Equal Treatment Rights
Pay excludes: occupational: sick pay; pensions;
maternity, paternity, or adoption pay; financial participation schemes
redundancy or notice pay (statutory or contractual)
advances in pay, or loans expenses the majority of benefits in kind bonuses not linked to work done
Pregnancy & Maternity Rights
Right to take paid time off for ante-natal appointments
Right to be offered alternative work, where assignment is terminated for H&S reasons
Right to be paid for the intended duration, or likely duration of the assignment
Liabilities & Remedies
Who is liable in the event of a claim: Client liable for Day 1 entitlements All parties potentially liable to the extent they’re
responsible Compensation award: minimum of two weeks
pay, no maximum Award can be reduced to what is just and
equitable Additional awards of up to £5,000 where
assignment(s) structured to avoid qualifying period
Failure to respond to information requests – tribunal could draw adverse inference
Who is Within Scope
Temporary Work Agency definition is wide: includes recruitment firms, umbrellas & other intermediaries supplying staff temporarily under the supervision & direction of [clients]
An Agency Worker is supplied by TWA to work temporarily under the supervision and direction of the [client], & has personal service contract with TWA, includes PAYE temps & umbrella contractors
Umbrella Workers
Umbrella workers could be outside of scope if no client supervision & direction
Otherwise umbrella workers will be within scope.
Low risk supplies:– AW earns equal/more than comparable perm– No significant bonuses within scope– Client holiday entitlement close to statutory
May be offered a PBA model to take worker outside of scope – it doesn’t
Pay Between Assignments Model
(Swedish Derogation) Only likely to be useful where substantial pay differential
Exemption from equalisation of “Pay” only All other equal treatment & day 1 rights remain Regulations ambiguous - compliant model
unclear - often low cost = high risk If found not to be compliant, the AW will have
right to equal Pay TWA/client could be liable if enforced the model
and/or refused any funding Risk likely to increase in unionised environment
Who is Out of Scope
BIS guidance suggests the following will not be agency workers: – genuinely self-employed – no client
supervision, no personal service, & TWA/client are client/customer
– Managed Service Contracts – supplying service rather than staff, supervised by TWA
– working for in-house temporary staffing banks
Managed Service Contracts
Service provider must genuinely supervise and direct its workers
If client determines the manner in which services delivered then probably in scope
On-site presence alone unlikely to be sufficient
If service provider engages workers through another TWA, then in scope.
Terms that apply dependent upon where supervision lies.
Limited Company Contractors
BIS: simply putting earnings through a limited company won’t put individuals beyond possible scope
They are likely to remain in scope where:– client is not a client/customer– client has supervision & direction of AW
A tribunal will look at the reality of the situation LC Contractors outside IR35 unlikely to claim Encouraging individuals into inappropriate
supply models or making it the only option is risky
Also increased risk under Managed Service Company tax debt transfer legislation
Determining Supply Model
Look at worker’s history:– Length & consistency of professional
contracting career, and tax status
Does the role lend itself to Ltd Co. model? Review procedures: supervision of
contractors Does client contract include flexibility to
allow self-employed contractors? Would a deliverables based contract
(rather than T&M) be appropriate?
Impact & Risk Assessment Partnership Approach
Impact AssessmentInformation Gathering Process – understand scale & structure of usage;
identify high risk usage, & other risk factors; assess supply models
Risk AnalysisDetermine risk level & cost of supply models: probability v.
severity; identify medium & high risks; identify cost & risk of possible alternative
Implementation StrategyNew supply models; revised internal procedures; communication;
review of contractual documentation; training
Impact AssessmentInformation to Identify
current supply model: LC contractor, Umbrella, PAYE
typical assignment length and pattern length & pattern of breaks between assignments “as if” terms, or identifiable comparable employee established/formal pay scale/collective
agreements basic terms & conditions at the workplace bonuses/commissions – are they within scope of
“pay”, already reflected in worker’s pay rate? annual leave entitlements union presence performance appraisal systems to calculate
pay/bonuses “day 1” facilities not routinely provided
Essential to Compliance Thorough impact & risk analysis Focus on medium & high risks Right supply model for worker & client Avoid encouraging workers into a
particular supply model Robust processes for information flow Fair contracts with clear liabilities in
terms of each party’s responsibilities Don’t assume that the responsibility lies
with the TWA that pays the worker Indemnities may not be that useful
What Next?
Recruitment Firms & Clients in partnership:– Undertake impact and risk analysis– Agree implementation strategy– Update all necessary procedures &
documentation– Identify any necessary additional
resource– Undertake training
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