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AGENCY STAFF: Agency of change

Date: 07 October 2011

Paula Whelan explains why fleet managers should aim to be one step ahead in determining agency worker fleet car provision after the recent changes in legislation

Fleet managers are ideally positioned to ensure that the true value of company cars offered to agency staff fall in line with the sweeping changes that will affect their pay and conditions, and which came into play from 1 October.

Under the new Agency Workers Regulations, temporary staff who work more than 12 weeks could be entitled to certain benefits equal to those of their permanent counterparts. However, with the regulations now in place, company car provision is just one grey area that requires further clarification if businesses are to avoid being taken to task for not making reasonable adjustments.

Prepare now

In terms of preparing sufficiently to meet the new legislative requirements, hourly rates have been a priority. However, this focus will inevitably shift to other areas such as benefits and company car provision.

At present, if a company car is requested by an agency worker in line with a package offered to a directly appointed comparator, employers may find it difficult to turn them down. Fleet managers may then be required to establish expensive fixed-term contract hire arrangements, many of which levy expensive penalties for early termination. If the business already has a long-term relationship with a preferred leasing company, this may be something that can be negotiated in light of them already being a preferred supplier. However, if this is not possible, fleet managers may need to address the issue of company car provision in conjunction with HR and procurement divisions where necessary.

There is a concern that despite spending millions of pounds every year on agency workers to supplement their existing workforce or fill specialist positions, some large businesses may only wake up to the regulations when another is taken to task.

To reduce the risk of being caught out, fleet managers should encourage employers to consider the issue now and agree a way forward for long-term agency worker contracts where company car provision is appropriate. In this way, last minute discussions about, for example, the value of a company car to an agency worker's contract after the 12-week qualifying period, can be avoided.

A key issue relating to whether agency workers qualify for the new rights to pay parity will need to be determined by the courts. For example, an agency worker may be deemed to have worked for the same hirer if they are working for one office in Hull, followed by another in Birmingham. The courts will therefore look at the type of work and if one activity cannot be regarded as different, the agency worker could qualify.

Additionally, many agency workers are on the books of more than one agency. In light of this, it's feasible that they could end up working on behalf of a number of agencies for the same hirer for 12 consecutive weeks without the other agency's knowledge. This is obviously even more likely if information about the worker's previous positions is inaccurate or incomplete.

Complex rules

Some employers may be in danger of taking the 12-week qualifying period too literally, without understanding the detailed rules that accompany it. Consequently, many HR directors are still not prepared for this legislation. While the rules surrounding the 12-week qualifying period are complex and will need to be worked through in court, more open communication and tighter systems to regulate the use of agency workers will help to minimise risks for employers in this area.

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Paula Whelan is a partner and employment law specialist at Shakespeares