On 1st January 2025, the current Temporary Agency Workers Regulations (S.L. 452.106) (hereinafter the “Regulations”), transposing Directive 2008/104/EC of the European Parliament and of the Council on temporary agency work, shall be replaced in their entirety by the provisions of Legal Notice 128 of 2024.
The provisions of the said Legal Notice shall bring into effect the following main changes to the current legal framework:
1. Extension of the scope of the Regulation
The revised Regulations will no longer be limited exclusively to temporary work agencies, as they now capture within their purview outsourcing agencies. (Temporary work agencies and outsourcing agencies are hereinafter collectively referred to as “employment agencies.”) This extension in scope ensures a uniform standard of responsibility and compliance for all employment agencies.
Outsourcing agencies are employment agencies that provide employment services consisting of the temporary assignment of their own employees to user undertakings. Unlike temporary work agencies, the said employees carry out the work for which they are assigned under the supervision, direction, and control of the outsourcing agency.
2. Exemption of certain employment agencies
By virtue of the coming into force of the Regulations, all employment agencies that are exempt from the requirement to obtain a license to operate as such in accordance with the Employment Agencies Regulations (S.L 452.130) and those which enter into employment contracts relationships and/or conclude employment contracts under a specific public or publicly supported vocational training, integration or retraining programme are exempted from its scope of application and are therefore not bound by its provisions.
3. Eliminating barriers to the applicability of equal employment conditions
The primary aim of the Regulations is to ensure fair treatment for employees temporarily assigned by employment agencies while preventing the exploitation of labour resources. In their current form and as amended by the Legal Notice referenced above, the Regulations require that employees assigned by employment agencies are afforded at least the basic working conditions (hereinafter referred to as the “working conditions”) of a comparable employee employed directly with the user undertaking to which they are assigned.
These basic working conditions are exhaustively listed in the Regulations and include remuneration, working time, overtime, and leave entitlements.
As the Regulations currently stand:
- Employees of employment agencies employed on an indefinite basis and paid between assignments are not entitled to equal pay with comparable employees of the user undertakings to which they are assigned.
- Employees of employment agencies assigned to user undertakings for a period of 14 weeks or more are not entitled to equal pay with a comparable employee of the user undertaking for the first four weeks of the temporary assignment.
With the amended Regulations coming into force, both these limitations will be removed. This ensures that the principle of equal pay applies from the first day of the assignment with the user undertaking, regardless of whether the contract is fixed-term or indefinite.
4. The applicability of the most favourable working conditions
While the requirement to afford employment agency employees the same working conditions as those of a comparable employee at the user undertaking remains unchanged, this has been reinforced by introducing an active obligation on employment agencies. They must take every measure to ensure that this principle is observed and adjust employment conditions accordingly.
Moreover, it has now been clarified that if the basic working conditions of employment agency workers are more favourable than those of a comparable employee at the user undertaking, the more favourable conditions must prevail. This provision ensures that employment agencies cannot downgrade favourable working conditions to align with less favourable terms of comparable employees at the user undertaking.
5. Exclusion of certain discrimination claims
The amended Regulations also afford protection to both employment agencies and user undertakings from specific types of discrimination claims:
(a) Employment Agencies
Employees of employment agencies cannot bring claims for discrimination against their employer where:
- There is inequality in working conditions compared to another comparable employee of the employment agency arising from the fact that the comparable employee is assigned to a different user undertaking.
- The employee in question is not currently assigned to a user undertaking, provided the inequality relates to an employee who is assigned.
(b) User Undertakings
Employees of user undertakings are barred from bringing discrimination claims against the undertaking on the basis of inequality in working conditions compared to a comparable employee of an employment agency.
Despite these protections for employment agencies and user undertakings, the Regulations make it clear that these protections do not grant a right to discriminate against any employee, whether employed directly by the employment agency or the user undertaking.
The amendments to the Regulations aim to strengthen protections for employment agency employees by addressing existing disparities. User undertakings and employment agencies must now carefully review and adapt their practices to comply with the updated requirements, thereby contributing to a more equitable and transparent employment landscape.