Benefits Of Employing Agency Workers and Contractors

Agency workers are ’employed’ by an agency which finds them jobs. The firm who’s hiring the worker pays a fee to the agency and the agency pays the employee their wages. If you are considering working for an agency or as a contractor, it’s important to understand the advantages and disadvantages. Businesses looking to hire employees on this basis also need to be aware of the pros and cons.

Benefits of Using Agency Staff

It’s important to remember that agency workers are of great value to employers and there has been rapid growth in the number of firms taking on agency workers over the past few years with the transition to a 24 hour day, 7 day a week economy.

They can be used to:-

  • Cope with unforeseen demand.
  • Cover sickness, holiday absence and maternity leave.
  • Provide extra support due to seasonal demand like the Christmas rush.

Employers today highly value the contributions made by agency workers. A good employer will ensure that temporary agency staff are given the same benefits, rights, training and support as permanent staff members. Employers of agency staff have no legal obligations to do so as the agency worker is ’employed’ by the agency and not the place where they work.


Pros of Working For an Agency

Despite the temporary nature of the employment, agency workers can benefit from working through an agency. The positives of such roles might include:-

  • Gaining relevant or additional work experience.
  • Getting a permanent job within a business using the agency.
  • Some roles may attract a higher hourly rate.
  • The ability to enjoy flexibility in your working life.

Although agency roles will not be suitable for every worker, and you have fewer rights as an employee, they can benefit your career in the long term. That said, you must be aware of the pitfalls.


Cons of Working For an Agency

In many cases, agency workers are not entitled to the same perks as permanent members of staff. It’s important to understand and prepare for this before commencing any agency role. You should check the employment contract with your agency (as they are, in effect, your employer) to see what you’re entitled to. Differences in employment rights may include:-

  • Not getting the same holiday entitlements or sick pay provision.
  • Too much variety on your CV if your roles are very different in nature.
  • Feeling isolated or not part of the team in the workplace.
  • Financial instability because of periods of unemployment.

Unless you are being unlawfully discriminated against, there is not much you can do if you receive fewer perks or benefits than permanent members of staff.

Agency workers have the same rights as every other member of staff when it comes to Health & Safety and discrimination at work. They must be given full training in health, safety and emergency procedures. They should also be given protective clothing at work, and any safety equipment needed. If they are working with a VDU or computer for example, they are also entitled to the same rest breaks away from the screen as permanent members of staff. They also get the same amount of rest break entitlements as other staff members if their shift is 6 hours or more.


What Are Contract Workers?

Contract workers come in various forms. They differ from agency workers in that they are paid by the employer direct and not an agency. They can be self-employed freelancers who offer their services to several companies simultaneously or to one company for a pre-determined length of time (usually called a fixed term contract) and can negotiate their own terms and conditions of employment directly with the employer.


Advantages of Using a Contractor

Contractors provide added flexibility when a company requires it. They can come in and do one off jobs or provide a service which no other member of the staff can provide. They can often begin work at short notice which helps employers meet a sudden demand. As an employer, you are not responsible for their PAYE, tax or national insurance administration.


Disadvantages of Using a Contractor

They may cost the business more than the employee equivalent day rate. Permanent staff may resent the contractor’s presence if they are being paid more for doing similar work. Contractors may not appreciate your business culture and may lack the motivation or commitment of permanent members of staff.


Contractors Rights

This type of employee will usually have the same rights and conditions as other members of staff with regard to paid leave and holiday entitlements, alongside their fundamental rights to health and safety and anti-discriminatory policies.


The Pros and Cons

The one thing in common with agency workers and contractors is that they come in “all shapes and sizes”. In other words, there are good ones and bad ones. The good ones can truly help a company thrive when times are difficult. When a company is in desperate need of additional help and support they can be valuable. Others may resent the fact that the role is not permanent, they might lack motivation and commitment and can be detrimental to a company’s business.

On the positive side, however, careful vetting and limited liability means that an employer can minimise the risks and can often end up with an additional member of the team that can make a highly significant contribution to a company.


As an alternative to using contractors or agency workers, many companies find that using workers on zero hour contracts offers greater flexibility. This type of employment offers a flexible pool of staff trained to suit the needs of the company. There are also no agency fees.

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