AWR Quick Reference Guide
Much is being said about the Agency Worker Regulations, however
what will it really mean for you? To enable you to get a feel
for AWR, we've very briefly summarised what it is and the different
services below.
This is only a quick reference guide so if you woud like further
information please contact us!
AWR - What is it?
EU legislation coming into force from 1st October
2011, aimed at ensuring temporary agency workers receive equal
treatment after a 12 week qualifying period when compared to their
directly hired, permanent counterparts.
AWR - Who is affected?
All contractors/agency workers are within scope of AWR if they
work through an umbrella company or via agency PAYE system,
unless:
- They operate through a Limited Company (PSC) and are in
business of their own account (outside IR35)
- They are in a 'Profession' and the hirer is a client of that
profession (i.e. a certified accountant working for an accountancy
firm)
AWR - The main points
There are two main areas within AWR you will need to know about
- the first is benefits that begin from Day 1 of your
assignment. The second is regarding entitlements that kick in
once you have completed a 12 week qualifying period at your end
client/hirer.
Day 1 entitlements
- Access to client facilities (canteen, crèche, transport
services etc)
- Access to all internal job vacancies
Week 13 entitlements
- Basic pay
- Annual leave
- Overtime
- Bonus or commission
- Vouchers/stamps
AWR - So what will be
different?
There will be some differences to how contractors work through
umbrella companies come October 2011. There are several
models that you will come across and Nasa Umbrella
offers all of the following:
1. Matching Permanent Pay
In many respects, this model will see the minimum amount of
disruption to your assignment. Here Umbrella Company, Agency
and End Client will all communicate and provide what is called
'Comparator Information' when you reach 12 weeks in your
assignment. This data will ensure that you receive at least
equal treatment with regard to the 12 week rights above,
particularly for Basic Pay.
Many contractors will already earn more than their perm
counterparts anyway, so you may only see some small adjustments for
holiday pay where the hirer may have a more generous annual leave
offering.
You are entitled to request this comparator data once you have
completed 12 weeks at your assignment from either Umbrella Company
or Agency.
2. Pay Between Assignments (Swedish
Derogation)
This will see a slightly different set up for you and some
additional items on your payslip.
By agreeing to a 'Permanent Contract of Employment' with your
umbrella company you will be able to receive up to 4 weeks' pay
whilst you are in-between assignments. By doing this you
agree that you will forego your right to basic pay under AWR.
Where you are in-between assignments, the pay will be at least
50% of your highest payment in the previous 12 weeks or National
Minimum Wage, whichever is the higher.
Tthis will not be on top of your normal wages; rather it will
operate much like 'Rolled Up Holiday Pay' does at present in most
cases. The 'Pay Between Assignments' pay will be calculated
and paid to you with your salary each week/month so you are paid in
advance of being between assignments.
Please note that by agreeing to this model, you will
forgo your entitlement to basic pay under AWR.
There may also be higher fees associated with this model due to
the extra costs for umbrella companies/agencies. Nasa
Umbrella will maintain our £9.99 weekly fee for this service
however.
3. Profession Exclusion
The regulations allow for an exclusion from AWR for those
contractors who are classed as working in a profession
and where the client is a business operating in
that profession.
The guidance is very ambiguous but under standard definition of
a profession, we believe the following are criteria that
demonstrate you to be working in a profession and will be able to
use the profession exclusion:
- Hold professional qualifications or certifications in your
field
- Member of professional industry body (Chartered Institute
etc)
- Perform a role involving high levels of skill (i.e. average
person could not perform your role)
4. Limited Company Services
If you are a higher earner (>£200 per day), and intend to
contract long term, a limited company may be a preferable
option.
Where you are genuinely in business on your own account AWR will
not apply. As such many agencies and clients may prefer that
you set up a Limited Company as they will have less admin and
compliance to undertake when placing you.
Nasa Consulting offers services of this nature and details can
be found here.
Summary
Whilst there are options available to you - please note that the
choice is entirely yours. No party may force you to work via
any particular model against your wishes. The legislation is
designed to protect contractors and agency workers, so seek advice
and choose the solution that best suits you.