Consultations on the zero-hours policy for agency workers

Yesterday, the Employment Rights Bill was read for the second time in the House of Commons.

The Bill contains a number of reforms, including measures to combat “one-sided flexibilities” in zero hours contracts.

There are two new rights. The first is the right to hours guaranteed that are based on the hours worked regularly.

Another gives workers a right to reasonable notice when it comes to shifts, and employers are required by law pay any cancellations or reductions in shifts that occur at short notice.

The consultation closes on December 2, 2024. It seeks to understand the views of agency workers on these measures. A later consultation will be held on their implementation more generally.

The government plans to repeal the Worker (Predictable Conditions and Terms) Act 2023. This would have introduced a “right of request” for a predictable working pattern that could be denied by an employer.

The report says that it believes that all workers, including agency workers, should be entitled to guaranteed hours after 12 weeks which reflect their regular hours of work. However, it acknowledges the fact in many sectors, it can be difficult to predict when agency workers are needed.

Hours Guaranteed

The consultation will also seek to determine whether the employer or agency should be responsible for offering the guaranteed hours.

If agencies guarantee hours, they may be held responsible for hours that they “have little or no ultimate control” over. The larger agencies that have many clients may be able cope with this, but it could be a risk for smaller agencies.

Employers would be better able to predict future work if they offered guaranteed hours.

The hirer may be forced to become an employer of the agency worker if the end-hirer is required to provide the guaranteed hours. This could have financial implications, such as “temp-to permanent” transfer fees.

In the consultation document, it is stated: “It’s not clear if the employer would find it practical to offer guaranteed working hours that did not require directly hiring the agency worker.” Please let us know if you think this is a viable option and worth pursuing.

In the consultation, a question was asked about whether or not end-hirers would be required to pay for a transfer fee if they were required to provide guaranteed hours to migrant workers.

Notice of shifts should be given with reasonable notice

The Employment Rights Bill will also give workers more certainty as to when and how long they are going to work. The bill will also stop employers from scheduling shifts last-minute to avoid having to pay for any cancelled or curtailed hours.

Workers can take their case to an employment tribunal if employers fail to give reasonable notice (the definition will be discussed in a later consultation). They will receive compensation for any losses they suffered.

The government wants agency workers to be entitled to reasonable notice but admits this is complicated due to the “tripartite” relationship between agency workers, agencies, and end-hirers.

The proposal is that the end-hirer as well as the agency are both responsible for giving reasonable notice. If necessary, the tribunal will decide whether either the end-hirer, or the agency, should be held liable for compensation of losses suffered by an agency worker.

The government proposes that agencies be responsible for cancelation payments made to agency workers before disputes reach a tribunal. In the consultation, respondents are asked if they agree and if the agency should have the right to recover these costs from the end-hirer in the event that it is at fault.

Reaction to agency workers working zero hours

Neil Carberry, chief executive of the Recruitment and Employment Confederation, said he was pleased with the consultation and described agency work as a vital route to employment for many workers.

He said: “We’ll use the consultation process to make sure the government is aware of the differences between ZHCs that are exploitative and agency work that is well regulated.”

The Employment Agencies Act and two other sets of regulations protect agency workers, who are enforced by a regulatory body. By working with an employment agency, employees always have someone watching out for them at a client’s site.

Crawford Temple, CEO at Professional Passport and an independent assessor for payment intermediary compliance said that the consultation appeared to “fall short” of addressing the true complexities of modern workforce solutions.

“The oversimplified view of zero-hour contracts could lead to a tarring of all flexible work arrangements, which may damage legitimate business models that benefit both workers and the economic well.

The consultation has not adequately addressed umbrella companies or joint employment scenarios. This is a cause for concern. Despite recognising these structures early on, the questions posed demonstrate a worrying regression to binary agency-versus-end-client considerations. This indicates a gap that needs to bridge between policy development, and the market reality.

He said: “Any meaningful change must be based on a deep understanding of the established practices and relationships.” The current consultation approach and questions in the consultation document could create legislation that is both difficult to implement and harmful to workers.

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