Agency workers earn around £400 less than employed individuals. This is one the findings of the latest research report released by the Resolution Foundation.

The research report had found that hourly pay of agency workers is 16p less as compared to their employed counterpart if they are employed in the same job for more than three months.

In conclusion of the report, the research firm had recommended that the Government should repeal Swedish derogation in the UK’s Agency Workers Regulations. Also, known as the ‘pay-between-assign ment’ contracts, the loophole in the law allows companies to pay less to agency workers as compared to the employed staff resulting in lower taxes being paid.

The agency research report had also suggested that companies should give a standardised written statement that outlines the rights of workers. The suggestions were in line with recommendations by Matthew Taylor report published last year.

Rampant Abuse of Agency Workers Rights in the UK

The report had found that although a lot of workers enjoy the flexibility of agency work, they are subjected to ‘poor and unlawful’ practices by firms in the UK.

Lost holiday pay is a critical issue faced by agency workers that have been highlighted in the report. According to an estimate by the Resolution Foundation, agency workers had missed nearly £500 million in unpaid holiday pay last year.

While agency workers are eligible for auto-enrolment of pensions, most weren’t provided this right.

The research report has suggested that the Employment Agency Standards Inspectorate should create task forces in areas that are contract workers’ hotspots such as Sandwell, Leicester, Barking and Dagenham, and North East Lincolnshire. The task force should investigate poor employment practice and ensure agency workers are given their rights.

According to Lindsay Judge, a senior researcher at Resolution Foundation, most research regarding modern working conditions had overlooked the problems of agency workers. She stated that policymakers need to address poor work practice while preserving the positive nature of the work.

Moreover, there is a need to reform the regulations regarding agency work to prevent abuse of agency workers. Stiffer penalties can be imposed against employers who fail to provide due rights of the agency workers.

While the Government indicated its willingness to act on the recommendations made by Taylor review that are also included in the Resolution Foundation report, it has not made a clear statement as to when the changes will take place.