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Agency Workers Directive:
Jobs at risk, say employers

Red tape and extra costs will stifle flexibility

More red tape for agency workers?

A new European Directive intended to give additional employment rights to agency workers could cost the UK over 160,000 temporary assignments, according to the Confederation of British Industry (CBI).

Agency temps account for 3.1% of the UK workforce - around 770,000 temporary assignments at any one time. For the most part agency temps are used by companies to cope with fluctuations in demand, or to cover for staff absence. Employment conditions vary: those engaged via the top agencies may already enjoy employment conditions that are better than current statutory requirements.

The aim of the European Agency Workers Directive, however, is to create parity between the working conditions and benefits of temporary workers and permanently employed ones. It is a continuation of the policy of creating parity for all "atypical" workers (as has been implemented for part-time workers).

The Directive proposes that there should be equal treatment of permanent and agency workers in respect of:

  • working time

  • pay

  • specified maternity rights

  • prevention of discrimination.

The UK government agrees with the principle of protecting the rights of temporary workers, but feels the minimum wage and working time directive have gone a long way to achieving this.

According to the Department for Trade and Industry (DTI):

"Agency work can provide a useful way in to the labour market, particularly permanent jobs, for workers. It can increase labour market flexibility in ways which benefit both business and workers. It can also offer workers who want to control or vary their patterns of work greater choice than permanent work. The Commission claims that the proposal would make temporary agency work more attractive to those looking for work and increase its status.

"However, there is a risk that the proposal could decrease the attractiveness of
agency workers to user companies, which might reduce the number of jobs available".

The recognition that many people prefer to work on temporary and/or agency contracts is an important one. It may be that such a way of working is preferable at a certain stage in one's life, due to family or other responsibilities. Or it may be the best way of acquiring new skills and moving into a different sector of work, and a new career.

Ruth Hounslow, public affairs manager for Manpower, the largest agency, puts forward the view from inside the industry:

"Manpower has always supported the principle of protecting agency workers' rights. However, we don't believe the Directive as it is currently framed does this. It is based on the assumption that permanent full time work is what everyone wants: it isn't. People do agency work because it gives them choice, develops transferable skills and enhances work/life balance. The directive could limit UK productivity by making it more bureaucratic and costly to use flexible staffing solutions. Employers will be far less able to flex their workforce to meet changes in their business."

The CBI surveyed UK companies to see how they would respond to the Directive if it were implemented. They found that 57% of companies who use agency workers would reduce the numbers they take on. 10% said they would stop using them altogether. But only 1% of employers said they would replace temporary staff with permanent ones, raising fears of job losses.

While this survey may represent employer attitudes accurately, it is unlikely to be a reliable indicator of their staffing strategies, as they would be left without enough staff to do the work.

The DTI is currently consulting on the proposal. Responses should be submitted by 18 October 2002.


Whenever an extension to workers rights are put on the table, employers' organisations cry foul.

Costs will be excessive; it will be too bureaucratic; it will cost jobs. The same comments have been heard since the first Factory Acts were proposed to limit the hours that children worked.

In the case of new regulation for agency workers, however, is the EU going too far?

Much if what is proposed effectively removes the advantages of using temporary agency staff, and many commentators feel flexible staffing solutions will become less attractive to employers.


Further information

The CBI survey and press release can be found in the news section of their website.

Manpower have on their website an informed guide to the proposals.

The DTI have made their response and consultation documents available on their website.





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