AWR costs force 17% of employers to opt for Swedish Derogation

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Although there has been an increase in the number of organisations opting to use a Swedish Derogation model, Danbro; the UK's leading firm of contractor accountants state that the majority still favour more traditional solutions when managing their temporary workforce.

Contractor Accountants

Contractor Accountants

Last year just 12% of employers told us they would be adopting Swedish Derogation contracts

A recent survey by Law firm Eversheds revealed that almost one in five employers opted for the Swedish Derogation model in a bid to mitigate against the effects of the Agency Workers Regulations.

AWR came into effect in October last year with an aim to seek wage parity between temporary agency workers and full-time employees after a 12-week qualifying period. Swedish Derogation allows employers to take on agency workers on a permanent contract, therefore guaranteeing them minimum levels of pay between assignments from their agency, it also eliminates the threat of a temporary worker claiming unequal pay to that of a comparable employee at their place of work.
Danbro, the award winning firm of accountants for temporary workers have been providing staffing agencies and businesses with a number of flexible options including a Swedish Derogation model. A spokesperson at the firm indicated that whilst some firms started to lean towards the Swedish Derogation Model since AWR’s introduction, the majority have continued using more traditional solutions such as the umbrella company or a combination of the two.

Richard Sheldon, an associate at Eversheds, says “Last year just 12% of employers told us they would be adopting Swedish Derogation contracts. Our latest survey results suggest take up of this option is in excess of 17%. They also indicate that those who adopt this approach tend to use it extensively.”

The regulation hasn’t just affected small and medium sized businesses, whilst the survey is anonymous, Tesco and Morrisons are reported to be amongst a growing list of national companies adopting this model.

About Danbro

Danbro are the UK’s leading firm of contractor accountants providing PAYE Umbrella Company and Limited Company accountancy services which aim to maximise the net take home pay of contract, freelance and temporary workers.

The firm were recently crowned winners of the ‘Commitment to Skills’ category at this year’s prestigious Red Rose Awards.

For more information:
Call: 0800 731 3178
Email: enquiries(at)danbro(dot)co(dot)uk

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Gerry Gregoire
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