Contractors working through umbrella companies may be interested to hear that the newly implemented Agency Workers Regulations will not prevent UK companies from building flexibility into their workforces, according to the REC.

A range of options remain for UK companies post-AWR, the REC insists, all of which rest on a key component: the development of a partnership approach between recruiters and employers.

The Swedish Derogation Model is but one example of legitimate new supply methods for skilled flexible workers, such as PAYE umbrella contractors, and ought not to be seen as some form of “get out clause,” the REC insists.

REC Chief Executive Kevin Green explained that one of the AWR’s effects was an innovative new method from employment agencies: employing some temporary workers on a permanent basis. He added “This is good news for temps as they get more job security. At the same time, agencies can benefit from having committed workers on their books and employers continue to have access to a crucial flexible resource.”

To all intents and purposes, the recruitment agency becomes the temporary worker’s employer with this model. Of necessity, this means that it must guarantee paying workers between assignments and making additional payments if contracts get terminated. The Swedish Derogation Model, he went on, should not be considered as a kind of AWR loophole – it was negotiated after “extensive consultation” and, he maintains, represents “a great way of protecting jobs and keeping the UK workforce flexible.”

In conclusion, he said “The key to making any new supply models work is to ensure strong collaboration and on-going dialogue between employers and their recruitment partners.”

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