Directive on temporary agency work could damage flexibility, warn CBI and government

During February 2002, employers' groups and the UK government voiced concern over the reported contents of the European Commission's forthcoming proposal for an EU Directive regulating temporary agency work, warning that the Commission's plans could cut across UK practice and damage labour market flexibility.

On 18 February 2002, the Financial Times led its front page with a report on a 'leaked' draft EU Directive prepared by the European Commission, which would give temporary agency workers the right to the same remuneration and employment conditions as directly-employed workers doing comparable jobs. It also reported that the Confederation of British Industry (CBI) had written to the Commission urging a rethink of its proposals, which the CBI considered would be 'very damaging to the UK labour market'.

The CBI is particularly critical of the reported proposal to enable equal treatment comparisons to be made between the terms and conditions of temporary agency workers and those of permanent employees of the 'user' company. According to Agence Europe, the CBI has told the Commission that requiring temporary agency workers to have the same rights and salaries as an enterprise's long-term employees would not be feasible in the UK and would result in fewer temporary agency workers being used. The CBI therefore proposes that agency workers should have equal rights and salaries with others in the same placement agency, but not within the enterprise where they are placed on a temporary basis.

The Prime Minister's official spokesperson answered questions on the issue at the usual Monday morning briefing for Westminster journalists held on 18 February. He said that the government believed agency workers should be entitled to a fair deal, but would want to check very carefully any proposed Directive to make sure that it was compatible with UK practice and the need for flexibility. He added that the government did not believe that agency workers were in exactly the same position as permanent employees inasmuch as they did not share a common employer, and that any proposal would have to be sufficiently flexible to accommodate this.

Reacting to the press reports, the Trades Union Congress issued a statement saying that it would welcome 'any proposals that grant new rights to temporary agency workers to ensure that they are equally treated compared with those doing the same job. Temporary workers in the UK not only face substantial job insecurity but they also often receive far less favourable treatment than those they work alongside. Lack of access to training results in lower skills while lower pay damages the motivation and inevitably leads to lower productivity. Unequal treatment for temporary workers is as bad for business as it is unfair to workers themselves.'

The Commission announced its intention to draw up legislation on temporary agency work following the break-down of talks between EU-level employers' and trade union bodies about a possible agreement on the issue in May 2001 (EU0106215N). The detailed proposals for the Directive are still under consideration within the Commission and are expected to be published shortly.

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