Since October 2011, under the Agency Workers Regulations (AWR), temporary agency workers are entitled to the same basic working conditions after working for a period of 12 weeks, as if they have been employed directly by the hirer. In a recent case (London Underground Ltd (LUL) v Amissah), LUL were found liable for a breach of the Agency Workers Regulation.
The Case of London Underground Ltd v Amissah
In the London Underground Ltd (LUL) v Amissah case, LUL hired agency staff from Train People (TP) but did not pay the staff the same rate of pay after 12 weeks as LUL employees. This was due to the fact that they did not believe the agency staff members were covered by the regulations due to ‘Swedish derogation’. Later they determined that they were covered by the regulations and entitled to the extra pay. LUL made a payment to TP to cover the difference in back pay owed.
However, TP failed to pass on payments that should have been made to the agency staff, and eventually became insolvent. The agency staff then brought a claim against LUL and TP for failing to comply with the regulations. The Employment Tribunal (ET) assessed that LUL had already made a payment to TP, and found that it was not ‘just and equitable’ for LUL to pay a further 50% compensation as this would mean that they would have to pay twice. The agency staff made an appeal against this decision which took the case to the Employment Appeal Tribunal (EAT), LUL subsequently appealed to the Court of Appeal.
The Final Decision by Court of Appeal
Under regulation 14 of the AWR, the hirer is liable for any breach of the agency workers rights, to the extent that it is responsible for that breach. Lord Justice Underhill ruled that LUL had chosen to enter into an agreement with a dishonest agency (TP) and therefore they should pay the compensation to ensure the claimants would not lose out on their entitlement.
He understood why the judge had ‘baulked’ at the idea of LUL having to ‘pay twice’, but stated that though the circumstances were regrettable, there was no fault on the claimants’ part and they had been underpaid wages for reasons that had nothing to do with them. Therefore, it was concluded that LUL ‘should bear the burden of TP’s dishonesty’.
If you have uncertainties about any employment law or HR-related matters, it is important to be fully aware of what you could be liable for.