Umbrella company contractors are no doubt well aware of the Agency Workers Directive that came into effect at the beginning of October.
Basically, AWR was designed to put contractors and temporary workers on an equal footing with their permanent counterparts when it comes to pay and working conditions.
Ever since AWR was announced, some companies have been looking for ways to get around it. Tesco recently confirmed that it was going to use the Swedish derogation model to avoid paying its temps the same wages as its permanent employees. In order to do this, Tesco will source temporary staff from recruitment agencies that directly employ their temps.
The Agency Workers Regulations do contain anti-avoidance measures, but employers are legally entitled to use the Swedish derogation model. The Sunday Telegraph recently reported that Tesco has asked a recruitment agency that supplies it with truck drivers in Kent to employ the temps directly. As a result, 400 drivers could lose £150 a week.
Tesco has defended its actions saying that a lot of agencies are using the derogation to ensure that temporary work remains flexible and competitive. The government, the Confederation of British Industry and the British Retail Consortium have all recognised this approach.
The supermarket giant added that this move is not a Tesco initiative and it is not asking agency workers to sign a new contract.
Meanwhile, the FPB has launched a new guide to help employers understand the recent changes to UK employment law.
The chief executive of the FPB, Phil Orford, explained that employment law can seem like a minefield that is continually changing. AWR is one of the biggest changes we have seen in recent times and it is vital that employers understand their responsibilities and stay on the right side of the law.
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Image: swedish flag by JSolomon
