NEWS & INSIGHTS

Predictable hours for agency workers? Implications of the Workers (Predictable Terms and Conditions) Act 2023 on the temporary labour market

Brabners LLP

Written by Brabners LLP

 

Background

The government published The Good Work Plan in 2018 and set out its intention to introduce legislation to allow all workers to have the right to request more predictable and stable terms and conditions after they had accrued 26 weeks’ service. This was expanded on in 2019 with the government’s consultation on what it termed “one-sided flexibility”; the consultation sought views on the introduction of a right for workers’ to receive reasonable notice of working hours and compensation for shift cancellations.

In February 2023, the government announced its support for the Workers (Predictable Terms and Conditions) Act 2023 (“Predictable Terms Act”). The Act received Royal Assent in September 2023, and though we have not yet been given a date for the Act to come into force, it is expected to be in Autumn 2024.

The Act

The Predictable Terms Act aims to give workers (including agency workers) the right to request more predictable terms and conditions of work. It’s intended to work in a similar way to the existing flexible working regime.

This means that workers will be able to make two requests per year for predicable working hours, although it won’t be a “day-one” right so workers must complete the relevant qualifying period of service before they are able to make an application. The qualifying period will be set out in regulations, but it is expected that workers wanting to make an application will need to have a minimum length of service of 26 weeks. Given that the purpose of the legislation is to improve unpredictable working patterns, it’s unlikely that the 26 weeks will need to be continuous.

Agency Workers

In the context of agency workers specifically, applications will be permitted if the following conditions are satisfied:

  • There is a lack of predictability in relation to the work that they are supplied by an agency to do for a particular end client (which is almost always the case);
  • The change requested relates to the agency worker’s work pattern; and
  • The agency worker’s purpose in applying for the change is to get a more predictable work pattern.

Applications can be made by agency workers to either the umbrella company, the agency itself, or to the end client. Applications must set out what change the worker is requesting to their working pattern, as well as the date from which they want the change to take effect. Where the application is made to the end client, the worker will be seeking the client’s agreement to offer them a direct contract (rather than continuing to work via an agency).

Businesses will be obliged to deal with any applications in a “reasonable manner” and decisions should be made and communicated within one month of receiving the application.

Given the ad hoc nature of the work done by agency workers, who are generally supplied to fill temporary gaps in a client’s workforce and are often called upon on short notice, it’s difficult to see how an agency or end client could grant a request for predictable working hours, and doing so arguably defeats the purpose of contracting which is, in its nature, unpredictable.

The Predictable Terms Act will only allow businesses to refuse an application on certain grounds, so employers and hirers will need to be careful that rejecting an application does not amount to a procedural failing or indirect discrimination. For example, rejecting an application from a female agency worker who needs more certainty to help manage her caring responsibilities could potentially amount to indirect sex discrimination.

One of the permitted reasons for refusing a request will be “detrimental effect on ability to meet customer demand”, so agencies and end clients operating in industries that rely on unpredictable working arrangements are likely to still be able to do so. However, they will need to introduce processes for dealing with requests for more predictable working patterns, even if the request may ultimatley be rejected.

In practice

It remains to be seen when the legislation will come into force and whether many agency workers will actually seek to rely on it in order to request predictable working hours or a direct contract of employment with the end client. Umbrella companies and agencies should keep an eye out for updates on the introduction of the legislation. In advance of it coming into force, agencies and umbrella companies should prepare policies and procedures for dealing with requests and train their staff on how to respond to requests within the confines and timescales set out in the legislation.

This bulletin is for general guidance only and should not be used for any other purpose.

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