Yvonne Gallagher, head of law firm Lawrence Graham's employment and pensions practice, said: "There is a lot of misinformation circulating around the Act.
"Speculation on how to circumvent the regulations is very dangerous as the financial implications for not complying could be considerable. Companies will be slapped with a £5,000 compensation award if they are found to be artificially structuring assignments to avoid giving rise to the entitlement. This would include, for example, requiring an individual to cease working just short of the 12 week entitlement period and then re-hiring at a later date.
"If after 12 weeks' work agency workers are not provided with the same benefits and pay as permanent employees, the company could face compensation claims covering expenses and lost earnings for which there is no limit. There is no grace period for some rights with access to full time job vacancies and a staff canteen kicking in from day one. Extra benefits such as redundancy pay, company sick pay and health insurance are exempt from the regulations however.
"Companies need to familiarise themselves with the regulations this week as many are clearly unprepared."
UK Agency Worker Regulations come into force on 1 October. From this Saturday, agency workers who have worked for a company for more than 12 weeks will have the same rights to basic employment and working conditions as permanent staff.
