Q&As

Can an employment business impose binding restrictions on a temporary worker to stop him from working directly for an end user or setting up his own employment business in competition?

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Published on LexisPSL on 09/03/2017

The following Employment Q&A provides comprehensive and up to date legal information covering:

  • Can an employment business impose binding restrictions on a temporary worker to stop him from working directly for an end user or setting up his own employment business in competition?

Can an employment business impose binding restrictions on a temporary worker to stop him from working directly for an end user or setting up his own employment business in competition?

An employment business is a business that arranges temporary work for work-seekers with a 'hiring company'. The temporary worker (often referred to as an 'agency worker') is paid by the employment business (agency) rather than by the company to which he is supplied (usually known as 'the supply of temporary workers' or 'the supply of agency workers').

Regulation 6(1) of the Conduct of Employment Agencies and Employment Businesses Regulations 2003 (Conduct Regulations 2003), SI 2003/3319 (SI 2003/3319, reg 6(1)) imposes certain restrictions on what an employment business may include in a work-seeker's contract. It states that an employment business (as defined in section 13(3) of the Employment Agencies Act 1973 (EAA 1973)) is not permitted, by including a restrictive term in a work-seeker's contract or otherwise, to:

  1. subject or threaten to subject a relevant work-seeker to any detriment on the ground that:

    1. the relevant work-seeker has terminated or given notice to terminate any contract between the work-seeker and the employment business, or

    2. the relevant work-seeker has taken up or proposes to take up employment with any other person

  2. require the work-seeker to notify the employment business, or any person connected with them, of the identity of

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