In this month’s First Tuesday Q&A, Kevin Slattery, Associate in A&L Goodbody’s Employment Practice Group, provides some insights into the law relating to agency workers.

1. What is an agency worker?

An agency worker is defined under the Protection of Employees (Temporary Agency Work) Act 2012 (the Agency Worker Act) as "an individual employed by an employment agency under a contract of employment by virtue of which the individual may be assigned to work for, and under the direction and supervision of, a person other than the employment agency".

An agency worker is contracted with, employed by, and paid directly by an employment agency. They are placed by the employment agency with a company (an End User) – usually for a temporary basis and for a defined project.  While the agency worker is not an employee of the End User, he/she works under its control.  Therefore, optically, it is often difficult to distinguish between an End User's employees and its agency workers.

A common misconception is that agency workers are independent contractors or consultants. While both categories of workers work directly for an End User, there are a number of key differences. Independent contractors work on their own behalf and are self-employed i.e. they are not employees. Further, unlike agency workers, they are usually contracted and paid directly by the End User.

2. Are agency workers entitled to any special protections?

An agency worker is a unique category of worker given the tripartite relationship that exist between it, the employment agency, and the End User. In recognition of this unique status, the Agency Worker Act sets out specific obligations for each of the End User and the employment agency.

Key obligations include:

• Agency workers are entitled to the same "basic working terms and conditions" of employment as if they were directly hired by the End User to do same or similar work. These terms and conditions include matters relating: (i) pay; (ii) working time; (ii) rest periods; (iv) rest breaks during the working day; (v) night work ;(vi) overtime; (vii) annual leave; and (viii) public holidays.

This obligation falls upon the employment agency (as the agency worker's employer). However, the End User must provide the employment agency with sufficient up-to-date information on relevant basic working terms and conditions of its employees so as to allow the employment agency to satisfy this obligation.

• The End User must ensure that agency workers engaged by it:
• are treated no less favourably than its employees as regards access "collective facilities and amenities". These are not exhaustively defined but include canteen, childcare, and transport facilities (for example, car parking); and
• are informed of vacant posts that become available within the End User which are relevant to the work the agency worker carries out for the End User.

3. Our company has engaged the same agency worker for many years, can they claim that they are now our employee?

They could try to take this claim, although reported cases where an agency worker claims employee status with an End User are rare.

Like the independent contractor versus employee distinction - which has generated a wealth of case law - the Workplace Relations Commission or a court would examine the totality of the relationship between the parties. This would include an assessment of: (i) the label the parties have placed on the relationship in any underlying contractual documents; (ii) the degree of control exercised by the End User over the agency worker; and (iii) how integrated the agency worker was within the End User's business. No one factor is determinative. However, it would follow that the longer the agency worker has been placed within in the End User, the more integrated they are within that business.

This issue arose in Diageo Global Supply v Rooney [2004] ELR 133. Here, the Labour Court held that the complainant, an agency worker, placed with Diageo (the end user) as a part time nurse was, for the purposes of the claim, engaged under a contract of service by the End User. In making this finding it took account of the following factors:

• While their wages were paid by the employment agency, the complainant entered into a contract with the End User;
• They had been interviewed by an employee of the End User, who had agreed their hours of work, rate of pay, and other particular benefits and duties;
• They worked exclusively for the End User for 11 years;
• The End User was held to have exercised day to day control and supervision over the complainant in the performance of their functions; and
• They were integrated into the organisation and always attended the Christmas party.

4. How can we mitigate the risk of our agency workers claiming that they are our employees?

While there are no hard and fast rules on this, the following practices may assist:

• Carefully manage the agency worker: reduce control, direction and supervision of agency workers, do not directly appraise agency workers, do not discipline agency workers and funnel feedback / issues through employment agency;
• Minimise integration: avoid giving agency workers supervisory or management roles and minimise involving agency workers in employee events such as representative forums and social events;
• Limit the duration of the assignment; and
• Review contractual documentation: ensure that the contractual documentation between the End User and the employment agency, and between the employment agency and the agency worker, are consistent with agency worker status.

5. An agency worker has been terminated by the employment agency. Can our company – as the End User - be liable?

Yes, under Section 13 of the Unfair Dismissals (Amendment) Act, 1993 an agency worker is deemed to be an employee of the End User for the purposes of an unfair dismissal claim. Therefore, an agency worker with 12 months' service can bring a claim for unfair dismissal against the End User - even though, in practice, the agency worker's employment was terminated by the employment agency.

It is important to note that an actual dismissal must occur. The termination of an assignment with an End User cannot in and of itself give rise to unfair dismissal claim. It must be followed by a termination of employment by the agency.

This provision places End Users in a tricky position insofar as defending an unfair dismissal claim. Very often the End User will have no involvement and possibly no awareness of the dismissal by the employment agency. Despite this, the WRC have consistently held that the End User may be liable for the dismissal. Thus, in Dunphy v Industrial Temps Ltd t/a Industrial Temps & Ano UD718/2014 the WRC rejected the End User's defence that it had not been aware of the agency worker's dismissal setting out that it:  "should have been aware of the legislation and its responsibilities towards agency workers".

Where an agency worker is placed with from multiple End Users, the WRC may examine which company was the primary End User. In A Barman v An Entertainment Venue ADJ-00011734, the WRC acknowledged that while the agency worker worked with two End Users, most of his work (up to 90%) was with the respondent, who was therefore responsible for the dismissal.

In practice, End Users should seek to future proof against these liabilities within the underlying commercial agreement with the employment agency. So, for example, it is relatively common for such agreements to contain an indemnity in favour of the End User covering liabilities associated with the dismissal of the agency worker by the employment agency.

Equally, an End User may seek to limit the duration of assignments so that the agency worker does not accrue 12 months' service. Where an End User has a more long-term need it could examine alternatives such as hiring a fixed term or permanent employee.