If you’re hiring temporary workers through agencies, you need to understand the Agency Workers Regulations 2010. These rules aren’t just bureaucratic red tape, they’re designed to ensure temporary workers get fair treatment. Getting it wrong can lead to tribunal claims, compensation pay outs, and damage to your reputation.
Let’s break down what employers and agencies must do to stay compliant.
What are the Agency Workers Regulations?
The Agency Workers Regulations (AWR) came into force in October 2011 to implement EU legislation protecting temporary workers. Despite Brexit, these regulations remain part of UK law.
The core principle is simple – agency workers doing the same job as permanent staff should get the same basic treatment after a qualifying period.
Who do these regulations cover?
The AWR applies to agency workers who are supplied by a temporary work agency (TWA) to work temporarily for a hiring organisation, where they work under the supervision and direction of that organisation and have a contract with the agency (either an employment contract or contract to provide services personally).
They must not be genuinely self-employed or in business on their own account.
Who’s excluded? Genuinely self-employed individuals operating through their own limited companies with real autonomy and the right to provide substitutes typically fall outside the regulations.
Understanding the three-way relationship
The AWR creates a triangle of responsibilities:
The Agency Worker (the temp) – Has a contract with the agency but works at the hirer’s premises.
The Temporary Work Agency (TWA) – Finds and supplies workers, pays them, and ensures they receive their rights.
The Hirer (the end client) – Supervises and directs the worker day-to-day and provides information about terms and conditions.
Both agencies and hirers have legal obligations, and both can be held liable for breaches.
Day one rights – what happens immediately
From the very first day an agency worker starts an assignment, they’re entitled to certain protections.
Access to facilities
Agency workers must have access to the same collective facilities as permanent staff. This includes staff canteens, rest areas and common rooms, car parking, childcare facilities (though they join waiting lists like everyone else), prayer rooms, and toilets and showers.
Information about job vacancies
The hirer must tell agency workers about permanent job vacancies in the same way they inform their own staff. If the hirer wants to employ an agency worker permanently, the agency cannot legally prevent this (though they may charge the hirer a fee in some circumstances).
Standard worker rights
From day one, agency workers also get National Minimum Wage or National Living Wage, paid annual leave (minimum 5.6 weeks), protection from discrimination, health and safety protections, and rest breaks under Working Time Regulations.
The 12-week qualifying period – when full rights kick in
After working in the same role with the same hirer for 12 weeks, agency workers gain “equal treatment” rights.
What counts as 12 weeks?
This is 12 calendar weeks, not 12 weeks of full-time work. Even if you work just one day a week, each week counts as a full week toward the qualifying period.
How breaks affect the 12-week count
Understanding what happens during breaks is crucial for compliance.
Breaks that PAUSE the clock allow you to pick up where you left off. These include any break of 6 weeks or less, sick leave up to 28 weeks, jury service up to 28 weeks, annual leave, workplace shutdowns like Christmas closures or factory shutdowns, and industrial action or strikes.
Breaks that CONTINUE counting include pregnancy and maternity periods from the start of pregnancy to 26 weeks after birth, plus statutory maternity, paternity, or adoption leave.
Breaks that RESET to zero include breaks longer than 6 weeks (with limited exceptions), moving to a new hirer, moving to a “substantively different” role with the same hirer, or sick leave or jury service lasting more than 28 weeks.
What’s a “substantively different” role?
A role is substantively different when the main duties genuinely change.
Simply having a different manager, working at a different location within the same company, or making minor adjustments to tasks doesn’t count as substantively different.
The change must involve different skills, competencies, or qualifications. For example, moving from a production line to an administrative role would likely be substantively different, but moving from one production line to another wouldn’t be.
The agency must inform the worker in writing that their role has substantively changed and the qualifying period is restarting.
Equal treatment after 12 weeks – what must match?
Once the qualifying period is complete, agency workers must receive the same basic working and employment conditions as comparable permanent employees.
Pay equality
Agency workers must receive equal pay, including basic salary or wages, overtime rates, shift allowances, performance-based bonuses and commission, annual pay rises, holiday pay (including any enhanced holiday pay above the statutory minimum), and monetary vouchers such as lunch or childcare vouchers.
What’s not covered includes company sick pay, enhanced family leave pay, pension contributions beyond auto-enrolment requirements, redundancy pay, notice pay, share options, and most benefits in kind.
Working time equality
Agency workers get the same working hours, rest breaks, rest periods, and shift patterns as comparable permanent employees.
Holiday entitlement
After 12 weeks, agency workers are entitled to the same holiday as comparable employees. If the company offers more than the statutory 5.6 weeks, agency workers get that too.
Pregnancy rights
After 12 weeks, pregnant agency workers are entitled to paid time off for antenatal appointments. The hirer must conduct a risk assessment and make adjustments or find suitable alternative work if needed.
What employers (Hirers) must do
1. Provide accurate information to agencies
Before the 12-week qualifying period ends, hirers must provide the agency with detailed information about basic pay for comparable roles, working hours and patterns, overtime rates, shift allowances, holiday entitlement, any performance bonuses, and rest breaks and working time arrangements. This information must
be kept up-to-date. If permanent staff get a pay rise, the agency needs to know so the agency worker can receive it too.
2. Track agency workers properly
Implement systems to record start dates for each agency worker, monitor which role they’re performing, track any breaks in service, calculate when they approach the 12-week threshold, and identify comparable permanent employees.
3. Respond to information requests
If an agency worker requests information about their day one rights, the hirer has 28 days to provide a written statement explaining what collective facilities are available, how to access information about job vacancies, the rights of comparable workers, and reasons for any different treatment.
4. Avoid anti-avoidance practices
Don’t deliberately structure assignments to prevent workers from completing the qualifying period. This includes moving workers between artificially different roles, creating unnecessary breaks just before 12 weeks, or using patterns clearly designed to avoid equal treatment. Employment tribunals can see through these tactics and will rule against you.
5. Train your managers
Line managers who work directly with agency workers need to understand how to integrate agency workers fairly, what changes at the 12-week mark, and when to escalate concerns about compliance. Many breaches happen because managers simply don’t know the rules.
What agencies (TWAs) must do
1. Request information from Hirers
Agencies must proactively request information from hirers about the terms and conditions of comparable employees, pay rates and structures, working time arrangements, and any changes to permanent staff terms. This should happen before the worker completes 12 weeks so you can ensure equal treatment immediately.
2. Ensure equal treatment
The agency is responsible for paying the agency worker correctly after 12 weeks, ensuring they receive the same pay and conditions as comparable permanent staff, and implementing any pay rises that permanent staff receive.
3. Monitor qualifying periods
Track each worker’s start date with each hirer, time in each role, any breaks and their length, and previous assignments with the same hirer. Remember, even if a worker changes agencies during an assignment, their qualifying period with that hirer continues.
4. Provide written statements
When an agency worker requests information about equal treatment, the agency must provide a written statement within 28 days detailing the basic working and employment conditions they’re entitled to, how their treatment compares to permanent staff, and any reasons for differences. If the agency doesn’t respond, the worker can request the same information from the hirer after 30 days.
5. Issue Swedish Derogation Notices
If you were using “pay between assignments” contracts (Swedish Derogation) before April 2020, these no longer exempt you from equal pay obligations after 12 weeks. You should have notified affected workers by April 30, 2020.
Agency and Hirer cooperation
Compliance requires close collaboration:
Share information proactively
Don’t wait for formal requests. Regular communication about pay structures and working conditions prevents problems.
Clarify responsibilities in contracts
Your agreement should specify who does what—particularly around information provision and payment of equal treatment entitlements.
Use consistent tracking systems
Both parties should maintain records that can be cross-referenced to verify qualifying periods.
Plan for the 12-week transition
Don’t leave it until week 11 to sort out equal treatment. Have the information ready in advance.
What happens if you get it wrong?
Agency workers who believe their rights have been violated can bring claims to an employment tribunal within three months.
Compensation awards
Tribunals typically award compensation based on the worker’s losses, but will award at least two weeks’ pay even if there’s no quantifiable loss.
Back pay
You may need to pay the difference between what the worker received and what they should have been paid.
Reputational damage
Word spreads quickly in the recruitment industry. Compliance failures can make it harder to attract quality temporary staff.
Legal costs
Defending a tribunal claim is expensive, even if you win.
Adverse inferences
If you failed to provide information when requested, tribunals can draw negative conclusions about your case.
Who’s liable?
Both the agency and the hirer can be held liable for breaches, depending on which party was responsible for the violation. The tribunal will determine liability based on who controlled the relevant aspect of the worker’s treatment.
Practical compliance checklist
For Hirers
- Create a system to track agency workers’ start dates and roles.
- Maintain up-to-date documentation of permanent staff terms and conditions.
- Ensure contracts with agencies clearly define information-sharing responsibilities. Train managers who supervise agency workers on AWR requirements.
- Set up reminders at week 10 to prepare for equal treatment at week 12.
- Conduct regular audits comparing agency worker treatment to permanent staff.
- Review and update your processes whenever permanent staff terms change.
For Agencies
- Request hirer information about comparable terms before placing workers.
- Track all workers’ qualifying periods across all hirers.
- Set up alerts for workers approaching 12 weeks.
- Maintain records of all information requests and responses.
- Review pay rates regularly and adjust when hirers change permanent staff pay.
- Ensure your contracts with hirers require them to provide timely information.
- Train your recruiters on AWR compliance requirements.
How the Employment Rights Bill will change things for agency workers
The Employment Rights Bill, currently making its way through Parliament, will significantly expand protections for agency workers beyond what the AWR currently provides. The government has confirmed that measures relating to zero hours contracts will be extended to agency workers, including rights to guaranteed hours contracts, reasonable notice of shifts, and compensation when shifts are cancelled, curtailed, or moved at short notice.
These changes are expected to take effect no earlier than Autumn 2026, with some provisions not coming into force until 2027.
Guaranteed Hours Contracts
Under the new rules, hirers (not agencies) will be responsible for offering guaranteed hours contracts to agency workers who regularly work more hours than their contract specifies, based on a 12-week reference period. This means if an agency worker consistently works 30 hours per week but only has a contract for 20 hours, the hirer must offer them a contract reflecting the hours actually worked.
This represents a significant shift in how temporary workers are engaged. Agency workers will have the right to contracts that match their working patterns, providing greater income security and predictability.
Notice of shifts and cancellation compensation
Both hirers and agencies will share joint responsibility for giving reasonable notice of shifts. When shifts are cancelled, curtailed, or moved at short notice, the agency must pay compensation to the worker, though they may be able to recoup these costs from the hirer through prior agreement.
This protection addresses a longstanding issue where agency workers could lose income through last-minute shift changes beyond their control. The exact notice periods and compensation amounts will be detailed in future regulations following consultation.
Day one unfair dismissal rights
Perhaps the most significant change is that employees will gain the right to claim unfair dismissal from their first day of employment, removing the current two-year qualifying period. While this primarily affects employees rather than agency workers in the traditional sense, it could impact how agencies and hirers manage long-term temporary placements.
Employers will be able to operate a statutory probationary period of up to nine months during which a lighter-touch dismissal process will apply for capability, conduct, or other substantial reasons, though redundancy dismissals will still require the full fair process from day one.
What this means for Agencies
Agencies will need to prepare for increased administrative complexity. They’ll need to track not only the 12-week qualifying period for AWR purposes but also monitor working patterns to identify when guaranteed hours contracts become required. The shared responsibility for shift notices means agencies must establish clear communication protocols with hirers.
The compensation obligations for cancelled shifts could affect cash flow and pricing models. While agencies may recoup costs from hirers, these arrangements must be agreed before the Bill becomes law and cannot be modified afterward.
Agencies should also review their contracts with hirers to clarify who bears responsibility for various obligations, as much of the detail will be set out in future regulations and guidance.
What this means for Hirers
Hirers face the most significant new obligations. They’ll need to monitor agency workers’ hours over 12-week reference periods to identify when guaranteed hours contracts are required. This adds another layer of compliance to the existing 12-week AWR qualifying period.
The notice and compensation requirements for shift changes may reduce flexibility in how hirers manage their temporary workforce. Companies that regularly adjust shifts at short notice will need to either change their practices or budget for compensation payments.
Hirers should also prepare for potential increases in costs. While some expenses can be passed to agencies through contractual arrangements, the overall cost of using agency workers may rise due to guaranteed hours obligations and compensation requirements.
Collective agreements and exemptions
An important amendment to the Bill allows provisions relating to guaranteed hours, reasonable notice of shifts, and compensation for cancelled or moved shifts to be excluded through relevant collective agreements incorporated into contracts. This provides some flexibility for unionised workplaces to negotiate alternative arrangements.
The New Fair Work Agency
The Bill creates a new Fair Work Agency (FWA) with enhanced enforcement powers, including the ability to bring tribunal claims on behalf of workers, provide assistance to claimants, and recover enforcement costs from non-compliant employers. The FWA will also enforce holiday pay record-keeping requirements, with employers required to retain records for six years or face fines.
This represents a significant shift from the current largely complaint-driven enforcement model. The FWA could proactively investigate agency and hirer compliance, making violations harder to ignore.
Timeline and consultation
The changes won’t happen overnight. The government has committed to consulting further on how these provisions will apply to agency workers, with guidance to be developed. Most changes are unlikely to take effect before autumn 2026, with unfair dismissal changes expected in 2027.
This timeline gives agencies and hirers time to prepare, but they should start planning now. As regulations and guidance emerge through 2025, businesses will need to review contracts, update systems, and train staff on the new requirements.
Getting ready for the changes
Both agencies and hirers should take several preparatory steps. Start monitoring agency workers’ hours now to understand patterns and identify who might qualify for guaranteed hours contracts under the new rules. Review existing agreements between agencies and hirers to determine where new provisions about shift notices and compensation responsibilities need to be added.
Consider how your shift planning and management systems will need to adapt to provide reasonable notice and track cancellations. Budget for the potential cost increases from guaranteed hours contracts and cancellation compensation.
Most importantly, stay informed as consultations proceed and regulations are published. The devil will be in the detail, and early preparation will make the transition smoother when these changes become law.
Compliance isn’t just about avoiding tribunal claims—it’s about creating a fair working environment where temporary workers are valued contributors, not second-class citizens. Get it right, and everyone benefits: workers get fair treatment, hirers get motivated staff, and agencies build stronger reputations.
