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UK – AWR claims have started

14 September 2012

Staffing suppliers are starting to register claims arising from the Agency Worker Regulation (AWR), which was introduced last year to improve working and pay conditions for temporary staff.

A survey carried out specifically amongst staffing suppliers by law firm Osborne Clarke found that just under 30% of respondents reported having had a claim threatened or received.

“We are aware of at least 12 claims to date, all of which relate to different aspects of the AWR. It would be premature to say that any trends are emerging, but staffing suppliers and hirers need to prepare for the real possibility of claims,” the law firm said in its report.

The survey shows that nearly half of respondents (49%) have an average of two or more intermediaries involved in their staffing supply chain, something which could lead to complex claims.

Just under 60% have received an AWR information request from their contract staff – however, 46% still have to agree with their clients, and 57% with their suppliers, what measures to take if they receive a request.

Other findings showed that 63% of respondents have signed AWR indemnities, particularly in the blue collar sector, while 78% confirmed having no insurance against AWR claims. There are, however, some specialist insurers which have started offering insurance against some costs relating to AWR claims.

Since the AWR has been enforced in 2011, costs have increased by +6% for 63% of those surveyed. For 11%, costs have risen by at least 20%.

Managed service providers (MSP) and recruitment process outsourcing (RPO) are also popular options with 75% of respondents saying they supply one or more clients through such arrangements. “In practice this means that, unlike most conventional employer/employee employment tribunal claims, AWR claims will tend to involve 4 or more parties,” the report states.

The survey also shows a clear difference on why so-called Swedish derogation arrangements are used. 68% of blue collar agencies said that this was due to clients and/or MSP/RPOs insisting on its use; this figure compares to just a quarter of professional staffing specialists.  

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