Late last week Employment Minister and part-time Wayne Rooney lookalike Ed Davey told industry watchers that a formal review of the troublesome Agency Workers Regulations would not take place until 2013, meaning agencies and Umbrella companies may have to suffer for as much as two years while case law is established to dictate the enforcement and scope of the AWR.
The Agency Workers Regulations, due to come into force on 1st October 2011, is designed to give “vulnerable agency workers” such as temps the same legal rights as permanent employees in terms of pay, holiday allowance and use of company facilities (among other things) after twelve weeks of service. Unfortunately for many freelancers who employ the services of Umbrella Companies, they too will be dragged along for the ride as they are legally designated Agency Workers.
The AWR will dramatically shake up the way Umbrella Companies are operated, and a number of solutions are currently being proposed. Many Umbrellas are opting for the “Swedish Derogation Model”, meaning their freelancers and contractors will be taken on as full employees – however an employment law body recently criticised the Swedish Derogation Model as not being the “miracle solution” many Temporary Work Agencies hoped it would be.
Freelancers who are in business on their own account and do not employ an Agency (for example, if you’re the director of your own Limited Company) will be outside the scope of the AWR.
Davey promised that the eventual review would take into account the recruitment industry’s feedback on the EU legislation, however given it is passed down from Brussels making amendments could prove tricky.
Photo by Aaron Geller – CC
