BBC report underlines the need for hotels employing agency workers to review their procedures

Posted: 01/11/2012

The recent BBC documentary featuring a Romanian journalist who went undercover as a hotel cleaner has raised concerns for some hotel operators who rely on agency workers to supplement their permanent workforce.

In the programme, which was televised on 28 September, BBC Newsnight teamed up with a Romanian journalist who visited hospitality agency Calibre posing as a hotel cleaner. The thrust of the exposé was that Romanians and Bulgarians who are members of the European Union are being exploited by UK businesses which engage them as self-employed workers. As a result, they do not have the statutory protection, including rest breaks, rest periods and the national minimum wage, afforded to workers and employees.

Self-employment arrangements

“Whether someone is an employee or is self-employed depends on whether they are contracted to perform personal services and if they are subjected to mutuality of obligation,” says Penningtons employment partner Jon Heuvel. “For Romanians and Bulgarians to claim ‘self-employed’ status, they must be in business on their own account. This means that they must be able to choose when and where they work - there is no obligation on the employment agency to offer work or for them to accept it. They should have the right to appoint a substitute if they cannot do the work themselves, should use their own equipment when providing services and must invoice the agency for any services supplied.” 

Jon adds: “Hoteliers who are supplied workers from Bulgaria and Romania need to be satisfied that they have sufficient information from the employment agency evidencing genuine self-employment arrangements. Otherwise, they should require such personnel to be removed from their property.”

Penalties for non compliance

Another point that hoteliers need to consider is the requirement to carry out right to work checks, as immigration specialist Penny Salmon explains: “Whilst Bulgarian and Romanian nationals are allowed to enter and live in the UK without permission, they continue to face restrictions on working in the UK. If they wish to work they either need to apply for permission - usually by way of applying and obtaining an Accession worker card - or fall into one of the categories which does not require permission, such as self-employment.”

Bulgarian and Romanian nationals can be fined up to £5,000 and/or three months in prison if found to be working illegally. In addition, employers could face prosecution and a £5,000 fine per illegal worker.

Contractual necessities

In these situations, hoteliers need to ensure that their contracts stipulate that agencies meet the required standards. Commercial, IP and IT partner Joanne Vengadesan comments: “As a basic, a hotelier should have a contract which requires the agency to comply with applicable laws, only employ staff who have a legal right to work and comply with all legal obligations of an employer. The agency should indemnify the hotelier if it breaches these terms, and the hotelier should also have rights to audit compliance, and to terminate if there is a breach. In addition, it is a good idea to have a more general obligation on the agency not to do anything which could bring the hotel into disrepute.”

If you have concerns about your employment agency arrangements, please contact our hotel experts.

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