Following our newsletter of 16th May 2008 the government has announced that it has agreed a deal with unions and employers that will see agency workers receiving equal treatment as employees. Equal treatment will mean the same entitlement to pay and basic working and employment conditions. The entitlement will arise after 12 weeks “in a given job”.
The employers organisation that has “agreed” this deal is the CBI which has commented “There has been a major risk of damaging legislation coming from Brussels, and the CBI has judged that the government’s proposals represent the least worst outcome available for British business. Half of agency assignments will be unaffected as they last less than 12 weeks – protecting businesses’ ability to deal with peaks and troughs in demand and shorter-term staff absences. And while pay is covered, occupational benefits that recognise the long-term relationship permanent staff have with an employer, like sick pay and pensions, are rightly excluded”.
The CBI goes on to say “Critically, as well as enabling the European directive on agency work to be put to bed, this agreement should allow the retention of the working hours opt-out from the working time directive, which is equally vital to the future of the British economy.”
The government appears to have also agreed that the new rules will be contained within legislation to be introduced later this year. In addition the government will now propose to the EU that this deal is adopted for use in the Agency Workers Directive which it is saying that it hopes will be agreed by the Autumn.
This statement does seem to be the clarification that was lacking last week, but the actual terms of the legislation, and therefore the extent of its application, is not yet known. Further, whilst the UK government has settled upon its position, it is by no means certain that this will be agreed by the remainder of the EU countries, some of which are pushing for a much shorter qualifying period or immediate rights on start of a placement.
It is not clear that the ramifications have been fully considered. Whilst the points of principle, for example effect on the flexible working arrangements (the CBI says that 50% of temp hirings will be affected) have been taken into account, has the full legislative result been thought through? Just as one example, where an agency worker is paid more than a comparable employee will the comparable employee be entitled to an increase? Or are we to expect further legislation to cover off discrimination in this area?
As things stand there has been no mention of the government consulting the interested parties (other than the unions) including the recruitment industry * is there to be a consultation? What will be the commercial impact?
Wait and see? Won’t affect me? You could be right, but on the other hand by doing nothing at this stage you increase the chance that key factors affecting your business may be overlooked, and opportunities to affect the outcome could be lost.
Knowledge is Power – Seminar
We will be discussing this issue in detail at our “Knowledge is Power” seminar on 24th June 2008. In addition Anne Fairweather of the REC will be advising on the REC’s position and its efforts on behalf of the industry. At that time the position may have become clearer and we will have had a chance to analyse the options for recruiters. We shall also be covering off a whole range of other crucial supply related issues.
If you would like to be kept informed of the latest updated information on events related to and evolution of the new legislation please email us.