The basic position is that under the Agency Work Regulations 2010, after 12 weeks, an Agency worker is entitled to “the same basic working and employment conditions” as an employee. Pay is included for these purposes but occupational sick pay is excluded. If the Agency worker is off sick (and this would include if they were self-isolating) then they would be entitled to SSP only and, whether you paid this or the Agency (usually the Agency as they operate the PAYE payroll), it is recoverable for the first two weeks. Obviously, SSP is just under £95 per week.
Agency workers who are employees will be regarded as unfairly dismissed if the reason is a breach of the AWR i.e. by not providing them with pay that an employee would receive.
So, if a business closes and the Agency worker is not required to work at all, you would still have to pay them if you were paying other employees. Unless you ended the agreement with the Agency. Redundancy would be an option as an Agency worker who is dismissed by reason of redundancy is not entitled to statutory redundancy pay or notice pay. If you refused a payment that other employees were receiving (except sick pay) this could give rise to tribunal claims – unfair dismissal and detriment under the Agency Worker Regulations. The Hirer and the Agency can both be liable depending on nature of the breach. The Tribunal will apportion liability.
If an Agency worker has less than 12 weeks service then there is no protection under the AWR.
Temporary Work Agencies
Short term assignments
If the agreement is a daily agreement, then it is very simple to terminate. The Agency Worker is simply not required, therefore, the agreement does not continue. These agreements are usually identifiable as they do not have an end date for the assignment. This is not always the case, so it is best to check with us before taking any action. Speak to the Agency first to find out if the new furlough arrangements could be used as part of the Coronavirus Job Retention Scheme.
Long term assignments
If the agreement is a long term agreement, then you need to look at the terms of business the school has entered into with the Agency. For each assignment there should be a ‘relevant assignment details form’, this may be called something different depending on the Agency but it basically details notice periods, day rate, start date and end date etc.
Within the terms of business it may state that it is necessary to give notice to terminate an assignment, sometimes it will say notice is not required therefore with immediate effect. As the Hirer (the school) is terminating the assignment, the terms of business may refer to ‘charges’ being due and the Hirer will be liable to pay those charges. This is where it becomes complicated; most terms of business are different depending on what Agency the Hirer has engaged with. If ‘charges’ are payable under the agreement it is essential to determine how those charges are calculated and what is necessary to be paid. The Agency will more than likely expect and want the Hirer to continue to pay the Agency Worker as a normal employee whilst the school is closed. They will also likely want the Hirer to pay as normal until the end of the assignment as detailed in the ‘relevant assignment details form’ mentioned earlier. Close analysis of the wording is key in determining the position.
If the Hirer wishes to terminate an assignment early, it would be beneficial if all parties can come to an amicable outcome where business relations remain intact. Most schools post the Covid-19 outbreak have queried what they should do in this situation and each case will need to be looked at individually.