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The AWR do contain a clause allowing the contracting out of the regulations but to be valid, in reality the affected workers have to satisfy the requirements that apply to settlement agreements. These include being advised by a qualified advisor, usually a solicitor, on the effects of the contracting out. This can also be done through ACAS if they are negotiating some kind of settlement between you and the employer. If it was just an agreement between you and the agency/employer then it is unlikely that on its own it would be legally standing as it would not have met the necessary criteria for it to be binding.
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