Holiday Pay



Annual Salary







The NEW Agency Workers Regulations (AWR)


This new piece of legislation is happening!


To ensure we can all be as ready as possible we have pulled together some key facts/guidelines that we hope will be of help.




From 1 October 2011 agency workers (temps and limited company contractors) will be entitled to the same basic employment and working conditions as permanent staff once they have completed a 12 week qualifying period.


From 1 October they will immediately (i.e. from day one of their assignment) be entitled to access to facilities and information on job vacancies.


So which of my “Agency Workers” will fall under the AWR?

  • All PAYE temporary workers

  • Limited Company contractors unless they can prove they are self employed.

  • Temporary Workers who are genuinely self employed will not fall under AWR (more on this later)


What does this mean from Day One?


Day one rights for agency workers will cover:

  • Access to information relating to vacancies – via the internet/intranet, job boards etc. This doesn’t mean you have to change your selection process for onsite agency workers.

  • Access to facilities

Facilities is a fairly broad term but the government guidelines define them as “collective facilities provided by the hirer either to workers or employees as a whole or to particular groups of workers or employees”. Examples include:

  • A staff canteen or restaurant

  • A workplace crèche

  • Company transport (i.e. shuttle bus)

  • Car parking

  • Vending machines

The regulations state that you are not required to give access to things where there is “enhanced “ access rights – e.g. a waiting list for a crèche or discounted benefits/products received through long-term service.



Rights after a 12 week qualifying period:


Firstly what is the 12 week qualifying period – an agency worker working in the same job with the same hirer/client for 12 calendar weeks.



So how is this worked out?


Firstly the 12 weeks calculating period will start from 1 October so prior temporary work will not qualify.  Therefore the earliest temps who started with you prior to 1 October 2011 will qualify for the 12 week rights is 24 December 2011.


Things that will count or be included in the 12 week count include:

  • Just one hour worked in a week will be counted as a week

  • If the agency worker has temped with you in that role via another source

  • The count/clock is paused due to sickness, taking annual leave, jury service, office closure (e.g. Christmas/New Year) and any breaks of less than 6 weeks.

The qualifying period continues during maternity, adoption and paternity leave.


If the agency worker is moved to a substantially different role then the qualifying period/clock is reset back to zero. 



So your agency worker has hit the 12 weeks qualifying period – what does this mean?


The agency worker will be entitled to equal treatment in terms of basic working and employment conditions.


This will cover items that would be outlined in terms and conditions such as pay, annual leave, overtime, working time, shift allowances, bonuses/commission directly related to quantity and quality of work produced, vouchers which have a monetary value such as luncheon vouchers, child care vouchers etc (that are not salary sacrifice schemes) and additional discretionary bonuses.


Also please consider that annual pay increases will also need to include agency workers.


Prior to 1 October we understand that many organisations are looking at how their contracts/terms are set out for permanent staff with a view to tidying up any ambiguous areas in relation to vouchers, bonuses etc.


Pay will not include for comparison purposes: 

  • Occupational sick pay (but we will still process SSP as applicable)

  • Occupations pensions

  • Occupational maternity, paternity or adoption pay (again we will process statutory payments applicable)

  • Redundancy pay

  • Notice pay

  • Season ticket loans

  • Bonuses not performance based or non contractual bonuses etc.  These would include bonuses which are based around the overall performance of the division/company – not the individual or bonuses designed to reward loyalty or longevity of service

The good news is that agency workers will not need to be included in performance appraisals.


Agency workers will be entitled to the same level of pay as a permanent employee in a comparable job.  To help with the calculation of the hourly rate we have set up the attached calculator, this will convert annual salaries to hourly rates:  Click on the button to use the calculator... 





Holiday Pay and Working Time


Agency workers will be entitled to the same holiday pay level as a permanent employee.  Currently all temporary workers receive the statutory 28 days per annum, including bank and public holidays.  If your company’s entitlement is higher then the agency worker will need to receive the additional days.  Under the AWR we will be able to pay this additional amount as a percentage of their pay rate each week.  They will also be separately paid their statutory 28 days leave allowance.


We have created a quick calculator for the holiday percentage increase.  Simply input the amount of holiday pay you offer permanent staff and it will calculate the uplift in holiday pay required (if any) to bring an agency worker’s holiday pay in line with yours.  Click on the button to use the calculator... 




If your temp is being paid more than your permanent employee you don’t need to do anything in regard to their pay but the other rights will still be applicable.



Pregnant Agency Workers and new mothers


Once a pregnant agency worker reaches the 12 week qualifying period they will be entitled to paid time off to attend antenatal medical appointments and antenatal classes when on assignment.


If a pregnant agency worker cannot complete their assignment due to health and safety reasons they will need to be found alternative work paid at the same rate or higher.  If an assignment is not available then pregnant woman will have the right to be paid for the remainder of the expected duration of their original assignment.



The Swedish Derogation / Pay Between Assignments


To enable agencies/hirers to be exempt from equal treatment provisions on pay the agency would need to offer the agency worker a permanent contract of employment and pay the agency worker between assignments when no work is available (this is sometimes referred to as the Swedish Derogation).  The pay between assignments needs to be at least 50% of the assignment pay (over the last 12 weeks) and at least National Minimum Wage


The other entitlements under the AWR would be applicable and the agency worker must have a permanent contract of employment.



Self Employed or not?


The regulations will not apply to agency workers who are genuinely self employed.  This does not automatically mean that if they work via a Limited Company/Umbrella Company or similar mechanism they are self employed.  Factors to determine if someone is self employed include:

  • The degree of autonomy that the contractor has in determining how the work is undertaken;

  • The degree of supervision, if any, that the end user client exercise over the contractor;

  • Whether the contractor prepares and submits his/her own accounts to HMRC;

  • Whether the contractor is entitled to be paid during periods where no work is being carried out;

  • The level and degree of financial risk which the contractor is exposed to under the contract and the extent to which the contractor is able to increase his/her own profit;

  • Whether there is a contractual requirement for the contractor to provide services personally.


So what are we doing?


At Love & Tate we are actively changing our systems and procedures to ensure we are compliant with the new AWR.  The regulations will be included in our ISO standards and you can expect to see: 

  • The Terms of Engagements we have with candidates being revised

  • Our standard Terms of Business for the provision of temporary staff also being amended slightly

  • The booking confirmation emails we send to agency workers and clients being updated

  • Our payroll team monitoring and flagging the 12 week qualifying period to consultants and in turn clients

  • Payroll actioning the increased holiday pay that may be required in some instances.


What should you be doing?


Firstly we should note that we are great at recruitment but do not profess to be lawyers so make sure that you get the right advice.  Our thoughts are that clients should be thinking about: 

  • What facilities should be extended to agency workers from day one

  • How will agency workers be able to access information on available roles and how will they be informed of this on day one

  • How you will tackle the 12 week qualifying period if agency workers switch agencies and/or roles while working with you

  • The fact that your consultancies will want information on salary levels for comparable roles to enable them to set pay rates at the right level after the twelve week period

  • Making sure that your consultancy knows what your standard holiday pay level is so that holiday pay can be adjusted at the 12 week qualifying period

  • Identifying genuinely self employed agency workers

  • Reviewing terms that permanent staff receive to identify what agency workers will be able to qualify for

  • Making sure that annual pay reviews happen for agency workers as well (where this is 12 weeks plus service)


Need to know more ...


Then please feel free to give us a call:


Jacqui Maxwell is happy to help,


020 7256 6668



Useful links


BIS Agency Workers Regulations Guidance (May 2011):-