Workers supplied by an agency may either simply be introduced by the agency to an employer who becomes their employer (common with long terms arrangements) or alternatively they may work for the agency and be temporarily seconded or supplied to a "client employer". For purposes of the Employment Agencies Act 1973, the former type of agency is called an "employment agency" whereas the latter is called an "employment business".

In either case, the general rule is that it is a criminal offence for an agency to charge a fee to a work-seeker for finding him work, subject to specified exceptions allowing agencies to charge fees to some work seekers, mainly people such as actor who are likely to have their own professional agents (see Employment Agencies/fees ). Further, an employment tribunal can ban persons from running an employment agency for up to ten years for misconduct or any other sufficient reason (see Employment Agencies/enforcement and prohibition orders ).

An agency worker whose contract is with an employment agency but who is supplied to work for a client of the agency may be an employee of either (or even both) of them or of neither - he or she may simply not be an employee at all as was the case in Muschett v HM Prison Service CA 2010 IRLR 451). The legal employment status of the worker is important mainly because a pre-condition for many employment law rights (notably the right not to be unfairly dismissed, but generally not discrimination law rights) is that the claimant must be, or have been, an "employee" as defined by ERA 1996 s.230. Several cases suggest that an agency supplied worker might well in law be an employee of the end-user client but other cases have made it clear that this is by no means automatic. Thus in 2007 the EAT held that a worker was an employee of the employment agency which supplied him to an end-user client even though it was the end user rather than the agency who exercised control over the actual operation of his work ( Consistent Group Ltd v Kalwak & ors EAT 2007 on 18th May 2007 and see also Wood Group Engineering (North Sea) Ltd v Robertson, EAT (Scot) on 6th July 2007). In practice for Employment Rights Act purposes (eg unfair dismissal) the worker is unlikely to be an employee of the agency as the agency will not normally have control of the work he does (see for example Dacas v Brook Street Bureau (UK) Ltd & anr CA 2004 ICR 1437).

In 2006 and 2007 the Employment Appeal Tribunal called for Parliament to clarify the employment status of agency supplied workers and there were some who hoped that a DTI Success at Work - Consultation on Measures to Protect Vulnerable Agency Workers, February 2007 might have led to legislative change. However the resulting Conduct of Employment Agencies and Employment Businesses (Amendment) Regulations 2007, SI 2007/3575 which came into force on 6th April 2008, did not deal with this issue.

The Agency Workers Regulations 2010, SI 2010/93 which are in force from 1st October 2011 do not deal directly with this issue either. However they do provide that afer 12 weeks working for a "hirer" an agency worker shall have the same rights as a the hirer's other employees, so the result may be that after 1st October 2011 the answer to the question of "who is the agency worker's employer?" will no longer be of much practical importance (see Employment Agencies/2010 regulations ).

There is a general BIS Employment agencies legislation and service standards web-site which includes pages dealing specifically with BIS views on the Employment Agencies Act Provisions in the Employment Act 2008. Enforcement is by the Employment Agency Standards Directorate (0845 955 5105),with increased powers under the Employment Act 2008 (see notes at Employment Agencies/enforcement and prohibition orders ). Those involved in IT consultancy work will find a valuable IT contractor "portal agency worker website" at www.contractoruk.co.uk - and see also notes in this program at Tax/avoiding PAYE and IR35 .

Revised regulations governing the detail of how employment bureaux (whether employment agency or employment business) have been in force since 6th April 2004 (the Conduct of Employment Agencies and Employment Businesses Regulations 2003, SI 2003/3319 - see notes at Employment Agencies/2003 regulations ). It is a criminal offence to fail to comply with the any requirement of these Regulations 2003 (punishable on summary conviction by a fine not exceeding level 5 on the standard scale (see Criminal law aspects/fines (levels of), for offences ).

There are no special provisions in employment law statutes specifically covering (or defining) "temporary" staff, whether provided by an "employment agency" or by an "employment business". Thus in UK law the question of what employment law rights a temporary employee may or may not have turns on normal principles, in particular whether he is technically an employee and if so whether he has completed any required period of continuous employment for the particular right being claimed.

The Conduct of Employment Agencies and Employment Businesses Regulations 2003, SI 2003/3319 (above) ensure that as from 6th April 2004 the precise contractual position between agency, end-user client and worker must be agreed and set out in a single document before the hiring starts (regs 13 to 17 and see notes at Employment Agencies/2003 regulations ).

The employment law position of a temporary worker who is introduced by an employment agency to an employer and employed by him under a (usually short) fixed term contract is considered further in this program under the notes on Fixed term contracts (especially important in the light of new rules effective from 1st October 2002). This note you are now reading deals mainly with the position of temporary workers who are not employed under Fixed term contracts .

It as been estimated that there are some 17,000 employment agencies in Great Britain supplying many hundreds of thousands of workers a year into temporary or permanent jobs. The sex discrimination legislation can be a particular problem for employment agencies and they must be careful to ensure that they do not discriminate against either sex by reserving some jobs for men and other jobs for women (see Sex Discrimination/agency workers ).

The 1998 Working Time Regulations specifically do apply to agency staff. They include a special definition of agency worker (see WT regs 1998, reg 36) and the provisions concerning minimum paid holiday and obligatory rest breaks as well as the maximum working hours provisions apply to agency workers as to others (see Working Time Regulations/holidays and/or Working Time Regulations/rest breaks and weekends ).

See also as appropriate Casual workers and/or Fixed term contracts and/or Part-time workers and/or Zero hours contracts and/or Family friendly proposals and/or Flexible Working and/or Holidays and/or Working time regulations . In relation to the special position of agency workers working for government departments, see Specific employments/civil servants/recruitment .