Small business groups have expressed their concerns over new plans that will see agency and temporary workers receive the same rights as permanent staff.
The entitlement will kick in once temporary workers have been employed for 12 weeks.
The CBI, which helped broker the deal with the unions, had been pushing for a six-month interim period before the right to the same treatment for agency workers applied.
Under the agreement, temporary and agency workers will qualify for the same pro-rata pay and conditions as full-time workers after 12 weeks but not other in-work benefits, like sick pay and pensions. They will have to work the same length of time as permanent workers to get maternity leave.
There will be anti-avoidance measures to stop employers changing job descriptions before the end of the 12-week period.
If the deal is accepted by the EU, it could lead to trade-off rules on the maximum working week, with the UK conceding equal treatment for agency workers in return for keeping its opt-out from the re-negotiated Working Time Directive, now under discussion in Brussels.
Small employers, however, have criticised the compromise agreement, citing the harm it may do to the flexibility of the labour market in the UK.
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.”
Tina Sommer, the EU and international affairs chairman at the Federation of Small Businesses, said: “This is a disastrous deal for small businesses, which rely on the flexibility provided by agency workers. Agency fees and high hourly rates mean temporary workers, far from being seen as cheap labour, are already a costly but useful way of responding to fluctuations in demand. If that flexibility is lost, many small businesses will stop using temporary employees.”
Phil Orford, the chief executive of the Forum of Private Business, commented: “The initiative was originally intended to protect the rights of temporary workers at the hands of rogue employers. However, yet again, it is the law-abiding small-business-owner who will suffer from additional regulation.”
EEF chairman, Martin Temple, described the measure as “another brick in the wall of labour market rigidity in the UK”.
But Mr Temple added: “However, we recognise the changing political scene in Europe and the pressure the government has encountered to find a solution. But this deal will only be acceptable if it results in a significantly better European Directive than is currently on the table.”
Date:21 May 2008
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