1- Does UK law regulate recruitment and staffing agencies, and what standards must they follow?
Yes. Employment agencies and staffing firms in the UK are regulated by law. The central legislation is the Employment Agencies Act 1973 and the Conduct of Employment Agencies and Employment Businesses Regulations 2003 (often called the “Conduct Regulations”). These set basic standards that agencies must adhere to.
2- Can an employment agency charge job seekers fees for helping them find work?
No, not in general. In the UK it’s illegal for an employment agency (or “employment business”) to charge individuals a fee for finding or placing them in a job. The law requires that the service of job-finding is free to the worker, agencies make their money by charging the employer/company a fee or margin. The Employment Agencies Act 1973 banned upfront fees to work-seekers, with only a few narrow exceptions.
3- When a temporary worker is placed through an agency, who is legally considered their employer – the agency or the client company?
Generally, the agency is considered the legal employer of a temp in many respects, though the situation can be complex. In a typical agency arrangement (often called an “employment business” arrangement for temps), the worker signs a contract with the agency, and the agency supplies them to work under the supervision of the client. The agency usually handles HR matters like pay, tax, National Insurance, and often holiday pay, which is a strong indicator that the agency is the employer for those purposes. The client company (where the temp actually works day-to-day) directs the work but doesn’t directly employ the temp. In legal terms, the client is often called the “end user” or “hirer,” and the agency is the “employer” (or at least the contract-holder) of the worker.
4- What rights do temporary agency workers have regarding pay, holiday entitlement, and sick leave?
Agency workers have similar core rights to direct employees, but some only apply after 12 weeks in the same role with the same client under the Agency Workers Regulations 2010 (AWR).
Pay: From day one, they must receive at least the National Minimum Wage. After 12 weeks, AWR gives them equal pay to a comparable permanent employee, including basic pay, overtime rates and shift allowances (but not pension, redundancy pay or enhanced maternity pay).
Holiday: Agency workers receive the statutory 5.6 weeks’ paid holiday pro‑rata. After 12 weeks, they gain the same annual leave entitlement as a comparable direct employee if higher. Holiday must be paid properly not rolled‑up into hourly wages.
Sick Leave: They can receive Statutory Sick Pay if they meet eligibility rules. Company sick pay schemes usually do not apply, as occupational sick pay is excluded from AWR equal treatment.
Working Hours & Rest: Working Time Regulations apply normally, covering rest breaks, night work rules and the 48‑hour weekly limit (unless opted out).
Day‑One Rights: From the first day on assignment, they must have equal access to workplace facilities like canteens or childcare and must be informed of internal vacancies.
Other Rights: They are protected by discrimination laws and health & safety regulations. In rare cases, long continuous service with the same agency (typically 2+ years) may give them unfair dismissal or redundancy rights, though continuity is often hard to maintain.
5-Do agency workers need to receive equal pay and benefits as a company’s direct employees doing the same job (and after how long)?
Yes, after 12 weeks. The Agency Workers Regulations 2010 give temporary agency workers the right to equal treatment in certain key terms and conditions after a 12-week qualifying period in the same role with the same hirer. In practice, this means once an agency worker has been in place for 12 continuous weeks, they are entitled to the same basic pay, holiday entitlement, working hours, rest breaks and overtime rates as a comparable direct employee of the client company in that role.
6- What should employers do to stay compliant with the law when hiring workers through a recruitment agency?
When using agency workers, employers (the client companies) should take a few important steps to ensure legal compliance:
- Use reputable licensed agencies – Make sure the agency is abiding by the Conduct Regulations. If in certain sectors (like agriculture/food processing), verify the agency has a GLAA license (Gangmasters and Labour Abuse Authority) if required. Doing due diligence on the agency’s track record will help avoid being complicit in any unlawful practices (like underpaying workers or charging fees).
- Define the terms in a contract – Have a clear agreement with the agency outlining each party’s responsibilities. For example, the contract should cover who is responsible for paying the workers (usually the agency), that the agency will pay at least minimum wage and holiday pay, the agency’s fee, and any temp-to-perm fee arrangements (so no surprises). Under the Conduct Regulations, any transfer fees must be agreed in the contract with an option for extended hire instead. The employer should know what those terms are.
- Provide accurate job information to the agency – The law requires that hirers give the agency enough information about the job – duties, required experience/qualifications, hours, workplace risks, etc. – so the agency can select a suitable worker. This helps ensure the worker is properly informed and qualified. It also triggers the agency’s duty to relay that info to the work-seeker. For instance, if a role requires night shifts or specific training, tell the agency upfront.
- Treat agency staff fairly on site – Even though they’re not your direct employees, when they work in your business, they are entitled to a safe environment and protection from discrimination and harassment just like regular staff. Also, under the Agency Workers Regulations, from day one you must give them equal access to facilities (canteen, lockers, childcare) and let them know about job vacancies internally. After 12 weeks, ensure you adjust their pay/holidays if needed to match comparables. To do this, you’ll need to share information with the agency about your comparable employees’ terms. Failing to do so can put you in breach of AWR.
- Health and safety – Coordinate with the agency on safety. The law (Management of H&S at Work Regs) says host employers and agencies must exchange info on risks. As the client, carry out inductions/training for the temp and inform them of workplace hazards. Also verify the agency has done any necessary health checks or training required before placement. Ultimately, if an agency worker is hurt on your premises, you could be liable if you didn’t take proper care.
- Avoid replacing strikers with temps – It’s illegal to use agency workers to cover for your own employees who are on strike (this was clarified when a 2022 rule allowing it was struck down). A responsible employer should not ask an agency to supply temps to do the work of striking employees – agencies themselves are prohibited from supplying for this purpose. Instead, focus on resolving the dispute.
- Keep records – Document the hours worked by agency staff and pay them/the agency on time. Since April 2020, agencies must give agency workers a “Key Information Document” explaining their pay rates, fees, etc., but as the hirer, you should ensure time sheets or approvals are prompt to facilitate proper pay. Also monitor the 12-week AWR qualifying period.
Consultation duties – Remember, if you undertake a collective redundancy exercise or TUPE transfer that affects agency workers, you may have consultation obligations toward them too. For example, agency workers count for collective redundancy thresholds and they have rights to information under TUPE.
7- Can a recruitment agency change a temp worker’s terms and conditions (like pay or hours) without the worker’s agreement?
A recruitment agency cannot change a temp worker’s pay, hours, or other key terms without the worker’s agreement. Once a worker has accepted certain terms for an assignment, the agency must consult them and obtain consent before making any changes.
This protection comes from the Employment Relations Act 1999, which prevents agencies from altering terms unilaterally. If a client requests changes, the agency should discuss them with the worker and issue a revised agreement. Changing terms without consent can amount to a breach of contract or unlawful treatment. In short, any major change must be agreed by the worker first.
8- Is it legal for companies to use agency workers to cover the duties of employees who are on strike?
No. it is prohibited. Historically, the Conduct of Employment Agencies Regulations banned employment agencies from supplying workers to perform duties normally done by striking employees. In 2022, the government briefly lifted this ban, but that change was invalidated by the High Court in July 2023, so the ban is back in force.
9- Who is responsible for the health and safety of agency workers while they are working on a client’s premises?
Both the recruitment agency and the client company share legal responsibility for an agency worker’s health and safety, but the client (host employer) has the primary day-to-day duty because they control the workplace. The client must provide inductions, training, supervision, PPE, and include agency workers in risk assessments just like their own staff. The agency must also brief workers properly and share relevant information about skills, risks, and requirements. In short, the host employer manages the immediate safety risks, while the agency and client must work together to ensure the worker is protected.
10- What new protections for agency workers were introduced by the Employment Relations Act 1999?
The Employment Relations Act 1999 introduced several important protections for agency workers. It stopped agencies from changing a worker’s terms, such as pay or hours without their consent. It also banned agencies from charging workers fees for finding jobs and restricted practices like “poaching” or moving temps between clients for the agency’s benefit. The Act extended protection against detriment for whistleblowing and union activity to all workers, including agency staff. It also clarified employment status by allowing agency workers to be treated as employees of the agency when they are not employed by the client, ensuring they have access to rights like unfair dismissal.
11- How do the Agency Workers Regulations 2010 affect employers that use temporary agency staff?
The Agency Workers Regulations (AWR) 2010 impose several obligations on employers (the client companies) who use agency temps, fundamentally to treat long-term agency workers more like their own employees. The major impact is the “12-week rule”: after 12 weeks in the same role, an agency worker is entitled to equal treatment on key terms and conditions as if they’d been hired directly.
12- Can an employer hire an agency temp as a permanent employee, and are there any fees or restrictions involved?
Yes, absolutely an employer can offer a permanent job to a temp, but often the agency will be contractually entitled to a transfer fee (also known as a “temp-to-perm” fee) if you hire their temp within a certain timeframe. Under the Conduct Regulations 2003, agencies can charge the hiring company a fee for taking on the worker directly, provided the agency’s contract with the company includes an option to avoid the fee by having the temp stay for a set “extended hire” period through the agency instead.
13- Is there a limit on how long a worker can be kept on a temporary agency assignment under UK law?
UK law does not set a maximum time limit for how long an agency worker can stay in the same assignment. A temp can legally work for the same company for years. After 12 weeks, they gain equal pay and basic working conditions under the Agency Workers Regulations, but this does not require the employer to make them permanent. Anti-avoidance rules prevent rotating workers just to avoid rights, but there is still no cap on assignment length. The Fixed-term Regulations don’t apply because agency workers are not employees of the client. In short, a temp can remain a temp indefinitely, as long as the agency and client continue to meet their legal obligations.
