In the case of Kocur v Royal Mail UKEAT/0181/17 the Employment Appeal Tribunal recently provided much needed clarity on the rights of agency workers after 12 weeks service.
Mr Kocur, was an agency worker with Royal Mail. By June 2015, Mr Kocur had accumulated 12 weeks of work and had triggered his rights under the Agency Workers Regulations 2010 (which are mirrored by the Agency Workers Regulations (NI) 2011 within Northern Ireland).
Under Regulation 5 of the Agency Workers Regulations, agency workers with 12 weeks service are entitled to the same basic working conditions as other employees.
Mr Kocur claimed that as an agency worker, his terms were different from Royal Mail employees, in that:
The Employment Tribunal found that whilst Mr Kocur was subjected to some less generous terms, these were compensated for by the Claimant’s higher rate of hourly pay, being £10.50 per hour compared Royal Mail employees who were paid £9.60 per hour. Indeed, the Tribunal held that Mr Kocur could take 2.5 days unpaid leave and still be financially better off overall and therefore concluded that there had been no breach of the Regulations.
Mr Kocur appealed to the EAT on three grounds:
Mr Justice Choudhury held that the Claimant was not entitled to the same number of weekly hours as a direct recruit. However, did uphold the first two grounds of his appeal in relation to annual leave and rest breaks.
The EAT held that employers must provide agency workers with 12 weeks service, with the same basic terms as their own employees and that they cannot rely on providing an agency worker with an “overall package” that is broadly similar. It concluded that the Regulations should not prevent agency workers from having more attractive terms, indeed it held that they are likely to have better terms than employees given the irregular and unpredictable nature of agency work.
The EAT’s decision is significant because it provides much needed clarification surrounding the 2010 Regulations. It is clear from Mr Justice Choudhury’s decision that employers cannot get around a disparity in terms (e.g. fewer holidays and breaks) by stating that a payment in lieu is being made or by offering a higher rate of hourly pay.
However, interestingly, the EAT did confirm that employers may consider other options for agency workers, including “rolled-up” holiday pay or payment of a lump sum on termination of the holiday assignment. However, the EAT was clear that if an employer seeks to offset a benefit in this way, the payment mechanism must be sufficiently transparent and clearly explained in advance. Employers should therefore be wary that this approach also has its limitations and in the majority of cases, it is more appropriate to ensure that agency workers have parity with employees with regards to their terms and benefits.