EU agency workers directive

Whilst many of you have no doubt heard of the proposed Agency Workers Directive (AWD), do you really understand the possible effect this proposal could have on your business and the recruitment sector? The general aim of the AWD is to help the EU “become the competitive and most dynamic knowledge-based economy in the world, capable of sustained economic growth with more and better jobs and greater social cohesion” and specifically: To improve the quality of temporary agency work by applying the principle of non-discrimination to establish a suitable framework for the use of temps in the EU Although recruitment agencies are well established in the UK, this is not the case throughout the EU (for example in Italy until recently the operation of an employment agency was deemed illegal). Indeed, some estimates suggest that as many of 1/3 of all agency workers in the EU are based in the…

Working time and holiday pay

Employment Tribunals (ETs) have made heavy weather of the provisions in the Working Time Regulations (WTR) relating to holiday pay. No one doubts that workers are entitled to payment, and many agencies include a sum in respect of that pay with normal “wage” payments. Conflicting results have arisen from applications to ETs, on the one hand indicating that inclusive payments are not legal, and on the other hand indicating they are. To the rescue comes the Court of Appeal, which has indicated that if the parties agree that pay includes holiday pay then it can be held to be a valid arrangement. The lesson from this is that you should not include payment for holidays within the normal pay rate unless you have the worker’s express agreement, or you want to run the risk of a claim. However, this particular sea is murkier than first appears. A recent decision makes…

Risk management and insurance

Effective risk management is crucial to businesses of all sizes and is no less important to a recruitment agency when the market is in a downturn. It may be tempting to ignore risk when the times are tough but storing up potentially dangerous liabilities could prove costly in the long term. Contracts An important aspect of reducing risk is assessing the commercial terms of the contracts that the agency signs. These will include the trading contracts signed with clients and contractors as well as contracts with suppliers. It is vital that every agency is fully aware of rights, obligations and restrictions contained in commercial contracts. This requires checking which terms are absolute obligations, which terms require the agency to use its reasonable endeavours and which terms require using best endeavours. There are important legal distinctions and being aware of these will be an important part of a strategy to minimise…