What is the Agency Workers Directive (AWD)?
The Agency Workers Directive is a Directive that became European Law in December 2008. The deadline for countries to implement this Directive is December 05th 2011. The Directive states that all ‘Temporary Agency Workers (TAW)’ must receive the same equal pay and basic working conditions that are in place for a permanent worker employed by the end user. The Bill was signed by the President of Ireland on Wednesday the 16th of May and will be retrospective from the 5th of December 2011.
Who is covered by this Directive?
An individual employed by an employment agency under a contract of employment by virtue of which the individual may be assigned to work for, and under the direction and supervision of, a person other than the employment agency. This means that a Limited Company Contractor would be excluded but an agency worker on PAYE would be covered.
Who is an Agency Worker?
An agency worker is a person who has an agreement with an agency to work for another person. This applies to individuals who meet the definition of an agency worker. An agency worker is defined as an individual who is supplied by a temporary work agency to work temporarily under the supervision and direction of a hirer; and who has a contract of employment or any other type of contract (a contract for services for example) under which they provide their service personally for the agency. This would include ‘self-employed’ contractors but exclude Limited Company Contractors.
How does an Agency worker qualify for equal treatment?
From the 5th December 2011 they have the right to equal treatment in basic working and employment conditions – (refer to Appendix 1, page 8, for linked details). Therefore, temporary agency workers employed by employment agencies and assigned to work with a hirer, are entitled to equal treatment in basic working and employment conditions in the same way as if directly recruited by the hirer to the same job. This means equal treatment in respect of:-
(b) Working time,
(c) Rest periods,
(d) Rest breaks during the working day,
(e) Night work,
(g) Annual leave, and
(h) Public holidays,
But does not include sick pay or payments under any pension scheme (these were specifically excluded in the earlier draft of the legislation but the reference to their exclusion has been dropped in the proposed amendments) – (refer to Appendix 1, page 8, for EU Directive on Temporary Agency Work Directive 2008/104/EC and existing Irish Employment Legislation Acts).
Are Holidays included?
Yes the same holidays as a comparable worker or if no comparable worker what they would get if hired directly. This means that an agency worker may be entitled to more than the statutory minimum of 20 days per annum.
Are Holiday entitlements retrospective?
No, the entitlement to holiday pay only comes into force as and from the date of enactment.
Who to compare against?
There is no actual comparator instead it is what the agency worker would be entitled to in terms of basic working and employment conditions if they were to be hired directly by the hirer to do the same job.
Who does the Directive not apply to?
The Directive does not apply to a contractor operating through a Limited Company. Also it does not apply to the following:-
(i) The work placement programme administered by An Foras Áiseanna Saothair (FÁS),
(ii) The scheme administered by FÁS known as the national internship scheme,
(iii) Any variation, extension or replacement of the programme,
(iv) Any vocational training, integration or retraining scheme or programme financed out of public moneys that the Minister may specify by order.
What is equal pay?
Equal Pay is defined in the Bill to be published as basic pay, shift premium, piece rates, overtime premium, unsocial hour’s premium and Sunday premium where a Sunday is worked and a premium is normally paid to a directly recruited employee. Other pay components will not be included e.g. occupational pension schemes, financial participation schemes, sick pay schemes, benefit in kind and bonuses.
Who is responsible for establishing equal pay?
Employment Agencies should make appropriate arrangements to ensure that equal treatment is put in place from 5 December, 2011 for all temporary agency workers, including those assigned on or after that date. The hirer is required to provide such information to the agency as is necessary to determine equal pay and conditions.
Who is liable if the Temporary Agency Worker (TAW) is not treated as set out by the legislation?
The agency, unless the hirer has refused to provide the agency with the information required to enable the agency to comply. In which case the hirer is required to indemnify the agency.
Is the End-user obliged to give information as to what the permanent employees are being paid?
Yes – It is the duty of the hirer of an agency worker to provide the employment agency that employs that agency worker with all such information in the possession of the hirer as the employment agency reasonably requires complying with the ‘Temporary Workers Agency’ Act.
What happens if the end user refuses to disclose the information required?
Where proceedings in respect of a contravention of this Act are brought by an agency worker against an employment agency and the contravention is attributable to the failure by the hirer of the agency worker to comply with this section of the Act; the hirer shall indemnify the employment agency in respect of any loss incurred by the employment agency that is attributable to such failure.
What happens if the end user refuses to pay the agency to enable them to pay the ‘Temporary Agency Worker’, the equal rate?
The agency will be liable. It is up to the agency to decide if it wishes to deal with such a client. If the agency pays less than the rate that the agency worker would get if hired directly then the agency is in breach of the Act and would be liable.
When does equal treatment not apply?
This does not apply to a Limited Company or ‘Swedish Derogation’ (see paragraph 16 below for definition).
What is the Swedish Derogation?
Where an agency worker is employed on a permanent basis by the agency and paid in between assignments.
Can a temporary worker go in on a lower hourly rate than a permanent worker if they have less experience in that position?
The agency worker must be paid what they would be paid if taken on directly; this could be less than existing permanent staff due to such things as experience, qualifications, length of service. However, the hirer needs to ensure that they can back up the rate they quote as rate that they would pay if recruiting the person directly.
Information regarding permanent positions?
The agency worker must be informed about any vacant position in the same manner as the hirers’ employees would be informed.
If the agency is based in the North of Ireland but providing agency workers into the Republic of Ireland, does the 12 week derogation rule apply?
No, if providing agency workers into the Republic of Ireland then the rules of the Republic of Ireland apply.
The DEJI has published its guidance document on the Protection of Employees (Temporary Agency Workers) Act 2012. You can access it on the Department's website through the following link http://www.djei.ie/employment/rights/taw.htm
Agency workers also have certain rights under the following employment legislation:
- Unfair Dismissals Acts 1977 to 2007
- Redundancy Payments Acts 1967 to 2007
- Minimum Notice and Terms of Employment Acts 1973 to 2005
- Organisation of Working Time Act 1997
- Payment of Wages Act 1991
- Maternity Protection Acts 1994 and 2004
- Employment Equality Acts 1998-2008