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TUC lodges complaint against use of “Swedish derogation” agency contracts

The Trades Union Congress has lodged a formal legal complaint against the UK Government with the EU Commission. The complaint alleges that the Agency Workers Regulations fail to properly implement the Temporary Agency Workers EU Directive. The complaint centres on the abuse of so called “Swedish derogation contracts”.

In terms of the Agency Workers Regulations, after 12 weeks in a post agency workers are entitled to the same pay and conditions as permanent staff doing the same job. However, a Swedish derogation contract exempts the agency from having to pay the worker the same rate of pay, as long as the agency directly employs the worker and guarantees to pay them a minimum amount for at least four weeks between assignments.

The UK legislation specifies that the worker must be paid either the national minimum wage or at least 50% of the agency worker’s highest pay in the previous 12 weeks. The TUC alleges however that this contrasts sharply with the position in Sweden, where these contracts originate, where agency workers receive equal pay in post and 90% of their normal pay between assignments.

Evidence gathered by the TUC shows that Swedish derogation contracts are used regularly in call centres, food production, logistics firms and parts of manufacturing.


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