The Swedish derogation 





Possibly the most significant of the government planned reforms set out in its 2018 Good Work Plan is a commitment to abolish the so-called “Swedish derogation”. The abolition is to take effect from 6 April 2020 (the Agency Workers Amendment Regulations 2019). It will represent a major victory for trade unions and follows several years of campaigning, including a TUC complaint to the European Commission. Evidence commissioned by the Department for Business, Energy and Industrial Strategy (BEIS) supported union reports of widespread abuse and showed that these contracts are rarely, if ever, entered into at the worker’s request. 
 


The “Swedish derogation” is currently found in regulation 10 of the AWRs. The term “Swedish derogation” is used to describe these arrangements because the exemption was introduced to accommodate working patterns peculiar to Sweden. 


Regulation 10 provides an exemption from the right to equal pay only (not equal treatment on holidays and working time) for arrangements that meet the following qualifying requirements: 




• the individual must have a contract of employment with the agency which is not fixed-term and which includes terms governing minimum pay rates, location, hours, maximum hours expected on an assignment, minimum guaranteed hours (which must be at least one hour), and type of work; 





• the individual must be paid between assignments, at least 50% of the pay received on the last assignment or the National Minimum Wage for the hours worked on the last assignment, whichever is greater; 





• the agency must try to find suitable assignments when worker are between assignments; and





• the contract cannot be terminated until there has been an aggregate of at least four calendar weeks between assignments when the individual was not working but was being paid by the agency.





The 2018 Good Work Plan includes other proposals that affect the rights of agency workers. These include: plans to strengthen the powers of the enforcement body with responsibility for agency workers — the Employment Agency Standards Inspectorate; to introduce state enforcement of holiday pay and sick pay rights; to provide a Key Facts Page for these workers (see box); and to increase the number of frontline inspectors. Future agency workers may also be given a statutory “right to request” more predictable and secure working conditions (seee box on page 43).