Agency worker status upheld for Ryanair contractor
The Court of Appeal has clarified when a worker supplied through an agency will be treated as employed by the agency, and confirmed that fixed-term arrangements can still count as temporary for the purposes of agency worker protections.
Background
In Lutz v Ryanair DAC, the claimant was a pilot who worked exclusively for Ryanair for just under two years. He was engaged through a recruitment agency on a five-year fixed-term contract. Although initially required to supply his services via a personal service company, it was accepted that this structure had no legal effect. The contractual relationship was directly between the pilot and the agency.
In practice, the pilot was fully integrated into Ryanair’s operations. He wore a Ryanair uniform, followed Ryanair procedures, booked leave through its internal systems, and worked to its roster. However, he was paid by the agency, and his contract made clear he was not employed by Ryanair.
Following termination of the contract, the pilot brought claims for unpaid holiday and for equal treatment with directly employed Ryanair pilots. The key issues were (1) whether he had worker status for the purposes of claiming holiday pay, and (2) whether he was an agency worker supplied 'temporarily' to Ryanair within the meaning of the Agency Workers Regulations 2010 (AWR).
By the time of the Court of Appeal hearing, it was accepted that the pilot had worker status and an employment relationship for the purposes of both claims. The only questions were who employed him, and whether his assignment fell within the scope of the AWR.
Court of Appeal decision
The Court held that the pilot was employed by the agency. The contract between them fully explained the basis on which services were provided, and there was no need to imply a contract with Ryanair. The Court confirmed that in a typical agency arrangement, the fact that the hirer exercises day-to-day supervision does not mean the hirer is the employer.
The Court also upheld the tribunal’s finding that the pilot had been supplied 'temporarily' to Ryanair. It reaffirmed that 'temporary' in the context of the AWR means 'not permanent' — in other words, not indefinite. A five-year fixed-term contract still qualifies as temporary.
It made no difference that some agency workers had in the past received successive fixed-term contracts. The claimant’s own engagement was for a defined period, and he had no expectation of renewal. That was sufficient to bring the arrangement within the scope of the AWR.
Learning points for employers
This case confirms that agency workers engaged under long fixed-term contracts are not excluded from the protections of the AWR. The decisive question is whether the engagement is indefinite or time-limited, not whether it is short in duration.
Importantly, the Court was considering only the preliminary issue of whether the pilot could bring claims under the relevant legislation. It did not rule on whether his claims for holiday pay or equal treatment will ultimately succeed. That will be decided at a later stage and we will continue to report on developments.