The Basics You Need To Know

The Agency Worker Regulations came into effect on 1st October 2011. They necessarily regulate the working conditions of temporary workers by affording them the same pay, working hours and holiday allowances as regular employees. The agency workers are entitled to get this equal treatment after working in the similar job for 12 weeks. These weeks can easily be accumulated by you even if you only work a few hours a week.

The umbrella company contractors are affected by AWR for those who are caught inside IR35.

Firstly, we are required to initiate who the Agency Workers Regulations apply to, these are:

  • Temporary Work Agency (TWA)—individuals or companies engaged in the allocating temporary agency workers, either directly or indirectly, to work temporarily for and under the supervision and direction of a hirer.
  • Agency Worker - individuals working as temporary agency workers.
  • Hirers – the end user.

Contractors, consultants, and freelancers who are in business for their own purposes will usually not be within the purview of the regulations.

The Temporary Work Agency (TWA)

The agency workers are supplied by a temporary work agency (TWA) to work temporarily for a third party (the hirer). The agency worker works temporarily under the direction and supervision of the third party but only has a contract with the TWA. Under the AWR, a TWA is a person whether individual or company in business, engaged in the supply of temporary agency workers. This could be an intermediary or an agency such as an umbrella company.

An individual is not restricted from being an agency worker under the AWR just because they work through an intermediary. For example: an individual who works through an umbrella company finds work through a TWA and is covered by the AWR. The individual will often have the comprehensive employment contract with the umbrella company with complete employment rights and the employee’s income usually being considered as an employment income. However, that will not restrict the individual to get benefitted from the AWR.

Agency Worker

An agency worker is an individual who is having a contract with the TWA but works temporarily for and under the supervision and direction of a hirer. The relationship between agency, agency worker and hire is a key feature of the AWR and who is covered by them.

The main elements required to be an agency worker are:

  • The contract must exist between the worker and a TWA, meaning that the TWA temporarily supplies the worker to a hirer.
  • The worker should work in accordance with the supervision and direction of the hirer when it comes to working on an assignment and the individual should not be in a business for one’s own purposes.

The Hirer

The hirer is an end-user or a person such as company, sole trader, and partnership, a public body which is involved in economic activity and employs agency workers through a TWA. The hirer is accountable for directing and supervising the agency worker while they manage the assignment.


Day 1 rights for all agency workers
The site facilities (such as childcare facilities, canteen etc.) are accessed by agency workers and must be able to obtain information on job vacancies from the first day of the assignment.

After 12 weeks in the same job
The equal treatment qualifies associated to pay and other basic working conditions (such as annual leave, rest breaks etc.) come into force after an agency worker completes a 12 week entitlement period in the same job with the same hirer. Once the qualifying period gets completed, pregnant agency workers will now be permitted to take paid time off for ante-natal appointments during an assignment.

It is not backward-looking and for those agency workers already on assignment, the 12 week entitlement period was started from 1st October 2011.

What this means for:

Temporary Work Agency
If you are engaged in supplying the temporary agency workers, you would be required to ask the hirer for the information about pay and basic working conditions (provided the agency worker to be in the same job with the same hirer for more than 12 months) so that they are considered as if they had been directly hired on the job.

Temporary Agency Workers
From 1st October 2011, once you have worked in the same job for 12 weeks, you will be entitled to equal treatment with respect to pay and basic working conditions. You can easily accumulate these weeks even if you only work a few hours a week. Your details would likely to be asked from your temporary work agency to help establish whether you are qualified for equal treatment.

Hirers of Agency Workers
As an employer, if you hire temporary agency workers through a temporary work agency, then you should give your agency with up-to-date information on your terms and conditions so that they can ensure that an agency worker obtains the correct equal treatment as if they had been hired directly, after 12 weeks in the same job. You need to ensure that all agency workers have the provision of your facilities and are able to view the information on your job vacancies from the first day of their assignment with you.

Exemptions to AWR

The following two exemptions are applicable on the Agency Worker Regulations:

  • Where the status of the agency or hirer is that of a customer or client of a professional service. A professional is usually someone who got the certification from a professional body such as a doctor, lawyer or accountant. In general, a professional who offers services to a client or customer is not working under that person’s direction or supervision.
  • Where the agency worker is in business for one’s own purposes.

Freelancers and contractors working through their own limited company and are actually in business for one’s own purposes will usually be out of the ambit of the Agency Worker Regulations. Whilst IR35 is part of tax legislation and AWR is employment legislation, if the contractor falls outside IR35 then there are higher chances that the contractor will also be outside of the AWR. Go through our Guide to IR35 for more information.


After the completion of the 12 week qualifying period, the agency workers qualify for the same basic terms and conditions that he or she would have obtained if recruited directly. This consists of terms and conditions associated with key elements of pay. Pay for these purposes means sums of money paid to the worker in relation to the worker’s employment.

How can Nexa Accountants help you?

If you have any queries or questions to ask, get in touch with our business representative on : 020 3004 9303 for more information.