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Agency Work & Contracts

By: Garry Crystal - Updated: 14 Jun 2017 | comments*Discuss
Agency Work & Contracts

Agency workers, often known as temp workers have a different relationship with employers than regular workers. Whereas regular employees work directly for a company and have a contract with them, agency workers are employed by a third party. Agency workers may not be entitled to all of the employment perks that a regular employer will provide and it is important to have a contract of services with the agency that has hired the worker.

The Definition of Agency Work and Contracts

Workers who are hired by agencies and then placed in a job are not officially considered employees at the place they are working. No contract will exist between the agency worker and the company they work in. A contract will exist between the agency worker and the agency, and a contract will also exist between the agency and the employing company. Due to the nature of agency work, the temp is not an employee of the company but an employee of the agency. However, this does not mean that the agency worker cannot ever be considered an employee of the company that they have been placed in to undertake work.

How Agencies Operate

Employment agencies make money by finding their workers employment with third parties. Using temporary agency workers as an example, the worker will usually sit a number of tests with the agency to make sure that they meet the agency’s skill criteria. If this skill level is met and all documentation is in order then the worker will be placed on the agency’s books as available for employment. It is then up to the agency to place the worker in suitable employment.

Once the worker has been placed in employment, their wages will be paid to the agency, and these wages will be passed on to the temp worker. The temp worker will be told before each job the hourly rate they will be paid but this will not be the amount that the agency charges the hiring company. In actual fact the agency may charge the hiring company up to double the temp worker’s wage.

The Agency Work Contract

In the first instance the temp worker will have an interview with the agency; if all skill and documentation criteria are satisfactory then the temp worker will be given a contract. This is the employment of services contract that exists between the temp worker and the agency. This contract will include a number of specifications, clauses and expectations. These will usually include:

  • Hourly rate of pay
  • Length of employment
  • Information on holiday pay
  • Information on sick pay
  • Codes of workplace conduct
  • Information on tax and national insurance

Agency Worker’s Rights

There are a number of different rights and regulations between regular employees and agency workers. For example the rate of holiday pay may differ, and holiday pay will be paid through the agency rather than the employer. However agency workers are still entitled to their statutory work rights, as are all employees. Agency workers should always check to make sure their statutory rights are covered in their contract of services. If they are not detailed on the contract then there may be fuller documentation kept within the agency office and this should be available to be viewed by the worker.

Permanent Work

In many cases temporary workers will often go on to gain permanent employment with the company they have been placed to work at. Agencies will usually have their own stipulations regarding the fees they may charge to the hiring company if the worker is given permanent employment. In some cases no fees will be charged to the company if the temp worker has been there for around 13 weeks. Under usual agency work contracts, a temp worker can decide not to become a permanent member of staff. They can in fact decide to refuse jobs simply because it does not meet with their requirements. Some people simply like the freedom and flexibility that temporary work supplies.

Rules of Dismissal

Usually under the agency work contract terms, dismissal or a job ending can be immediate. There is usually no notice required by the hiring company to end the temp agency worker’s contract as they are not an employee of the company. However it has been known for a court to side with an agency worker, even if the agency contract states that a work assignment can be terminated without notice. In certain cases an appeal court has sided with the agency worker and decided that the dismissal without notice was unfair and they should be considered an employee and treated accordingly.

There are thousands of agency offices all over Britain supplying temp work. A contract for this type of work is legally required and working without a contract is an offence. Always check that statutory rights are included in agency contracts and enquire with the agency if they are not.

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I worked under agency unawere that I was hoping I work for the company. In two weeks time i was dismssid for non reason and i was told imidiedtly on that day. But now i see if you have worked fo agency with or without contract it must be 12 weeks. Can i sue them them to pay me and how to sue them?
Qhophello - 14-Jun-17 @ 10:33 PM
My agency sent me a job description two months ago for a Salary Scale Graded Level 4 University position which is £44k annualor £28 ph, the JD was provided by the hirer. Yet the agency said they would pay me £13 ph. I refused on the grounds that I had worked in the exact Level 4 role for the same salary scale amount, in the same department in another university. Then my agency came back and said my duties will not be all of the duties listed in the JD, they will only be basic administration not contract management work as per the JD provided to me. I accepted the temporary placement for £13ph due to the agency saying it would be basic administration duties. One month into the position the hirer asked me to do Level 4 Contracts Management work for £13 per hour and I declined and asked for more, they offered me £16ph, I accepted but then they tried to blackmail me by indicating that now that I have £16 I can do that work as well as report writing and other things, and I should be obliged to stay there for more weeks even though the contract is temporary -neither side has to provide any notice. I understand the 12 week rule in terms of equal pay but it seems unfair on a lot of levels in terms of a worker having the skill level at the salary scale and experience in the exact role at a number of universities, the same as the hirer's university and in the same city. I asked the agency to ask for more for the Level 4 position's duties and they told me to ask the hirer and the hirer said take it or leave it, you can leave at the end of this week or next week if you are not happy with the arrangement. So I said I will leave at the end of next week. I also feel they were avoiding the 12 week rule, they hired me for 2 months, then a month into the temporary contract asked me if I wanted to stay another 5 weeks, but they knew they needed me for more than 12 weeks before they hired me due to the fact I was an interim temporary placement before the permanent placement candidate came to fill the role, who had been secured before I had. I am now leaving before my contract period ends because I find the hirer unprofessional and quite vindictive, when they offered £16 they tried to bring it down to £15.50 to intimidate me, I said I would accept it, then they said £16 is fine. I found this a vindictive use of power, when at no point did I ask for this raise in an aggressive or unprofessional manner. I would like to know what your thoughts are on this, I would be grateful for your feedback.. Thank you
6000 - 7-May-17 @ 7:09 AM
Hi I've worked for an agency which has gone into liquidation I've been working in the same job for nearly 6 months I'm owed 2weks wages and 16 days holiday pay I've been told that I'm not entitled to any money owed because it was agency workers is there anything I can do
caz - 20-Feb-17 @ 3:39 PM
Hi I started working on a construction site for a company but they told me to come through an agency for they were not be able to pay me direct for tax purposes or wotever so I went through the agency they told me to the rate was already set comes the payday I was taxed under the EDM scheme which I had no idea wot it was and never was explained so I told all to the manger and to sort it out as I have been working on my UTR for last 2 years so all was sorted I sign the CIS contract with the payroll company and was payed rite but now the payroll company has send me a HYBRID contract signature request document and I have no idea wot that means please explain I tried looking for meaning but to no avail could be one of the scamming contract
Jas - 10-Dec-16 @ 5:55 PM
@Leah - yes the employer can postpone payment if the agreement is that you have to return your contract if that is their terms. I don't understand why you don't return it. You'll get paid then! Ash
AshL80 - 15-Aug-16 @ 12:20 PM
Hi, Last week I started working for an agency and over the phone they told me the application form needed to be returned for me to get paid on the Friday. I sis this and then Friday came and I was paid. I emailed asking why and they said it's because I haven't returned my contract. Now I was never told I wouldn't be paid of my contract wasn't returned within a week? I have now worked two weekends with no pay and am now dubious about signing and returning to a company that are being like this with me. Where do I stand and what should I do? Ps they also said if my contract isnt returned on Monday by 5pm they are going to assume I no longer want the job I am doing, can they do this?
Leah - 14-Aug-16 @ 3:02 PM
I was offered a contract and got a contract the day before the start date. Terms had changed (rate, duration, title) but was rectified for title and rate after several back and fros. The agency did not provide any details for starting on the agreed date the next morning (didn't even sign the contract themselves) claiming that they didn't get a purchase order from their client. Several days passed and same statement from the agency. Having signed the contract am I legaly bound to this job although the agency refuses to sign it after the start date and more to the point, cannot provide me the information to start working? Can the contract be put aside or rescinded on the basis of not allowing me to work from the start day to date. I am of course looking for another contract now but want to make sure I am in the clear. Really unpleasant situation. Thank you
jedkar - 12-Sep-15 @ 11:03 PM
@jeanette - it seems like one of those agencies that have fluctuations of workloads and while your employers may be on the ball at certain times of the year with things like reviews when work is quiet, they may have to change their operations when things get busy. Presumably, it seems like you have got the rough end of the stick and it is one rule for one and one rule for others. I think in this instance you would probably be better speaking to Acas as then you will be able to re-iterate the whole story. It would also be worth checking your contract to see what it says about the issues you are concerned about. You can speak to Acas via the link here. I hope this helps.
ContractsAndAgreements - 25-Feb-15 @ 9:50 AM
Hi could i get some advice ive beenworking for agency now 11 month,37hrs per wk on nights. i never had a review i was always hittin my perfomance, they sett aload more agency staff on just before xmas, now some of those have just got there contracts . they made me use 2wks of my holidays due to low volumes of work then , laid me off but theres still the other agency staff working there not hitting there perfomance. i think its very unfair how i ve been treat
jeanette - 22-Feb-15 @ 6:13 PM
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