Christmas comes early for Agricultural Employers?

11 Dec 2013

Agricultural and horticultural workers may not be overly joyful this Christmas. On 25 June 2013 the Agricultural Wages Board (AWB), which has set minimum wages and other terms and conditions of their employment since 1948, was dissolved.

The Government also abolished the Agricultural Wages Order (AWO) from 1 October 2013. Historically the AWO set a system of grades with different pay scales and overtime rates. It also set holidays for agricultural workers. Habitually pay and holidays under the AWO were greater than under the National Minimum Wage Act 1998 and the Working Time Regulations 1998 which now set the minimum standards.

Agricultural workers will no longer receive automatic pay rises, sick pay and holiday rights under the AWO. Instead their terms will be governed by the same employment law that applies to other sectors of the economy. Employers may engage new workers on terms negotiated personally to reflect local conditions and individual circumstances – but is this really a gift enabling them to cut overheads by reducing pay and conditions as some have suggested?

Workers employed before 1 October will continue on their current terms unless these are varied by agreement. We don’t think many workers will acquiesce in changes which are obviously detrimental and anyone who tries to retain new staff on less favourable terms than existing staff may find the Equality Act raised against them.

Settling pay and terms now requires a degree of engagement with wider employment law and sometimes a level of consultation which may have been absent from the sector before 1 October.

An early Christmas present? It’s more likely the advent of the law of unintended consequences. There will be a steady erosion of the differentials between AWO conditions and those negotiated in the new marketplace leading to an increase in the incidence of rural poverty and isolation.

Another consequence of the abolition of the AWB is that Agricultural Dwelling House Advisory Committees were closed to new applicants from 1 October but security of tenure under the Rent (Agriculture) Act 1976 remains in place.

The disappearance of the AWB is a significant cultural change for the agricultural and horticultural sector. Prudent employers will take it as an opportunity to review their conditions of employment in the context of the new landscape.