I have heard agency workers refer to the Swedish derogation. What is this?

Under the Agency Workers Regulations 2010, there is one exemption from the right to equal pay (but not to equal treatment on holidays and working time).

This is known as the Swedish derogation because when the Agency Workers Directive was being negotiated in Europe, the Swedish government asked for a special exemption, to reflect normal practice in the use of agency workers in Sweden.

This exemption applies where:

  • the agency worker has a contract of employment with the agency which is not for a fixed term and which includes terms governing minimum pay rates (which must be at least the National Minimum Wage), location, hours, maximum hours on an assignment, minimum guaranteed hours (which must be at least one hour) and type of work;
  • the agency worker 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 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 TUC has lodged a formal complaint to the European Commission that the 'Swedish derogation', as it is reflected in the UK's Agency Workers Regulations, is a breach of the Agency Workers Directive.

Note: This content is provided as general background information and should not be taken as legal advice or financial advice for your particular situation. Make sure to get individual advice on your case from your union, a source on our free help page or an independent financial advisor before taking any action.