Case partially clarifies agency worker employment status - Feb '08

For many years there has been a lack of clarity as to whether an agency could have employment rights as against a hirer. More technically minded readers will know that the ruling in Dacas (2004) first really set the cat amongst the pigeons, when the Court of Appeal implied that an agency worker could be an employee under an implied (e.g. unwritten) contract. Dacas was rapidly supported by a further Court of Appeal ruling in Cable and Wireless – v- Bushaway (2005).

The result was that every Employment Tribunal thereafter felt obliged to consider in every agency worker case where unfair dismissal or redundancy was claimed whether there was an implied employment contract. Bad news for recruiters supplying workers because end users rapidly became paranoid (and rightly so).

Now however in the appeal hearing of James v Greenwich the Court of Appeal has clarified its position. Agency workers will not generally be regarded as implied employees unless they work in a way that is not properly reflected in the worker’s agreement with the agency.

This case will no doubt reduce the number of agency worker claims based upon unfair dismissal or redundancy, and definitely represents good news. However the clarificationn only extends to situations where the contract and work arrangements are consistent. Where they are not, claims may still be made to Tribunals on basic principles and employment businesses still face risk.

Is this the end of agency workers employment issues?

Definitely not. There are moves afoot both in the EU and at home which threaten to affect status going forwards.

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February 2008.