Mooooove over Swedish Derogation!

Have you heard that from the 6th April 2020 Derogated Contracts (or Swedish Derogation Contracts) will be a thing of the past? Replacing them will be The Agency Workers (Amendment) Regulations 2019.

An independent review of modern working practices reported a high amount of abuse of the Swedish derogation. Agency workers are not given the option to choose the type of contract. Some Agency workers are either being forced into a derogation contract or receive no work. The review states that, under the derogation, it is too easy for companies to avoid paying workers between roles, by keeping them on longer assignments at lower pay or by offering them unacceptable assignments when they are out of work. The Agency Workers (Amendment) Regulations 2019 proposal aims to stop businesses from abusing the Swedish derogation to avoid offering agency workers equal pay.

What Does This Mean for Employers?

This means that from April 2020, all temporary workers will qualify for pay parity from the twelfth week of their working assignment. Employers will also need to send out a written statement to advise derogated contract employees to their right to pay parity. The aim is to carry out these events bt the 30th April 2020.

Furthermore, the contract rate will need reviewing if the assignment runs past April 2020. Any end hirers will also need to advise of any appropriate comparator rates.

A New Challenge for Agencies

The end of the road for derogated contracts could mean a new challenge for agencies and other companies. It will be a requirement for some agencies and companies to offer competitive pay rates. They are also required to ensure pay parity is met and to remove all derogation from contracts by April 2020.

Click here to find out more about the revocation of the Swedish derogation.

 

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