Bosses criticise agency staff rights

May 21 2008 By Andrew Mernin

A LANDMARK deal to give new employment rights to 1.4 million agency workers was warmly welcomed by unions last night but was described as "disastrous" by a business group.

Years of wrangling over the need to give agency staff the right to the same pay rates as full time staff ended with a Government announcement of equal treatment after 12 weeks of employment.

Unions hailed the breakthrough as a victory for workers, but groups including the British Chambers of Commerce, Institute of Directors and Engineering Employers Federation warned it would hit the UK’s flexible labour market.

The Government said it believed the deal could pave the way for an agreement in Europe on a new agency workers directive and was hopeful that resolving the issue will mean UK workers will continue to be able to opt-out of the European working time directive.

The CBI has long disputed the Agency Workers Directive, which has been blocked by the UK for a number of years. However, Gordon Brown has been under pressure from Labour back benchers to agree a deal. Although the 12-week period is longer than the Unions would have liked, it is significantly less than the 6 months or year which the CBI was pushing for.

Paul Scope, associate in the employment law group at Sintons Solicitors is wary of this development. He said: "Agency work provides essential access to the workplace for the unemployed and an extremely valuable pool of flexible labour for many organisations. The concern here is that offering parity with permanent staff will create a level of cost and bureaucracy which will lead to companies using less agency workers. In particular, large organisations such as banks use a lot of agency workers and higher unemployment rates is certainly not what the country needs at the moment".

It is thought that Gordon Brown wanted to agree a position on the Agency Workers Directive before the European Union summit next month, so that Britain can preserve its opt out to the 48 hour working week in exchange.

Meanwhile, Unison leader Dave Prentis said the announcement was "unfinished business" from the so-called Warwick Agreement - the deal thrashed between unions and the Government before the last general election.

"The abuse of temporary agency workers is a shameful relic of another age that should be outlawed. It cannot be right that in the 21st century, we still allow unscrupulous bosses to exploit the most vulnerable workers by denying them basic employment rights."

Unite joint leader Tony Woodley said: ``This is a landmark deal for 1.4 million agency workers currently working in the UK. The Government has listened, acted and paved the way to equal treatment in the workplace."

GMB general secretary Paul Kenny said: ``The agreement does not give us everything we would have liked but it is a big step forward for up to one million temporary and agency workers in the UK."

Billy Hayes, general secretary of the Communication Workers Union, said: ``A quarter of a million workers in the communications industries will directly benefit from this change. Legislation will also strengthen our and other unions’ bargaining rights to achieve better pay and conditions for agency members. It’s a great day for agency workers everywhere."

Miles Templeman, Director General of the Institute of Directors, said it was not good news for business, adding: ``The flexibility of the UK’s labour market is one of the reasons why we have one of the most competitive economies in Europe. Having given way on this, it is vital that we strengthen our legal position on the working hours opt out."

Tina Sommer, the Federation of Small Businesses’ EU and international affairs chairman, said: ``This is a disastrous deal for small businesses, which rely on the flexibility provided by agency workers."

David Frost, director general of the British Chambers of Commerce, said: ``This is a bad deal for the country and a bad deal for business. The success of the UK economy over recent years has been down to our flexible labour market.

``When the economy is weakening this is not the time to further reduce flexibility. In addition to this, with the Government seeking to move a million people back into work, a deal of this nature will not help."

Shadow minister for employment and corporate governance Jonathan Djanogly said: ``This deal represents another blow to Gordon Brown’s authority. While his own ministers have been lobbying against this legislation in Parliament and in Brussels, the Prime Minister has had to back down in the face of massive union pressure and backbench rebellion."

Liberal Democrat small business spokesman, Lorely Burt said: ``This new agreement is a welcome step forward, as temporary and agency staff are some of the most vulnerable employees."

PAGE TWO: Solicitor Helen Kay gives her views on today's news.