Member Article

A bill on the legal status of temporary agency workers in connection with stationing by an employment agency etc. has been adopted, and the act will thus become reality effective as of 1 July 2013.

The act has implemented the Temporary Agency Workers Directive which serves to protect temporary agency workers and improve the quality of the work of temporary agency workers by introducing a principle of equal treatment between termporary agency workers and the user companies' own employees.

The act applies to temporary agency workers who have entered into a contract of employment with a Danish or a foreign employment agency and who are stationed by the employment agency to user companies in Denmark to - on a temporary basis - carry out work under their direction and supervision. As such, it is a prerequisite for the application of the act that a triangular relationship (employment agency - temporary agency worker - user company) exists. Moreover, it is emphasised in the explanatory notes to the act that the temporary agency worker is to be employed with the employment agency for the purpose of being stationed. As such, employment services, contract work or casual work are not comprised by the act.

The principle of equal treatment implies that the employment agency must ensure that the temporary agency worker during the stationing in a user company as a minimum has the same terms and conditions of employment with respect to working time, overtime work, breaks, rest periods, night work, holiday, public holidays and pay as what would have applied under legislation, collective agreements or other binding general provisions if the temporary agency worker had been employed directly by the user company to carry out the same work as the user company's own employees.

Even though the temporary agency worker in accordance with the principle of equal treatment would be entitled to, inter alia, pension contribution in connection with direct employment in the user company, the act opens the way for employment agencies omitting to pay when the temporary agency worker is compensated through other remuneration. However, it is a precondition that the temporary agency worker is generally not placed in a less advantageous position.

The act prohibits the temporary agencies' use of successive stationing of the temporary agency worker without a justifiable reason. The prohibition is meant to ensure that no circumvention of the user company's seniority-based terms of employment, if any, can take place. Moreover, the temporary agency worker is, upon request to the employment agency, entitled to receive information on the terms and conditions of employment which the temporary agency worker under the principle of equal treatment has a right to during the stationing.

Clauses prohibiting or in fact preventing the temporary agency worker from taking up employment with the user company after expiry of a stationing period are invalid. However, the employment agency may request reasonable payment for services rendered to the user company in connection with the stationing, employment and training of the temporary agency worker. 

Pursuant to the act, the user company is obligated to inform the temporary agency worker of vacancies so that the temporary agency worker - on a par with other employees - is able to obtain permanent employment in the user company. Moreover, the temporary agency worker must have access to collective facilities and benefits in the user company on equal terms with the user company's own employees, unless there are objective reasons for treating the temporary agency worker differently. 

The employment agency's and the user company's lack of compliance with the act is sanctioned in accordance with the nature of the violation. For example, the employment agency's deliberate or grossly negligent violation of the principle of equal treatment is sanctioned with a fine, and the temporary agency worker - in addition to a potential claim for back-pay - may be awarded compensation. 

The act and its principle of equal treatment may to a great extent be derogated from in connection with a collective agreement entered into between the most representative sides of industry in Denmark.

The act and the scope thereof give rise to various considerations, and the act is unclear on several points. For instance, it is unclear how "other binding general provisions" are to be limited under the act, including whether the right to a paid day-off in accordance with a staff manual constitutes any such provision. As such, it will be interesting to see how the Temporary Agency Workers Act will be put into practice.