Courtesy navigation

News

October 29, 2010

Agency worker reforms costly for small firms, warns CBI

The Government’s decision to introduce the Agency Workers Directive without amendments next October will be costly for small firms – both in red tape and financially, the Confederation of British Industry (CBI) has warned.

The Agency Workers Regulations will give agency workers who have been in the same role as comparable employees for at least 12 weeks the same terms and conditions, including pay and holidays.

Business groups had proposed the regulations were amended to reduce their complexity and the amount of red tape involved for employers. However, the Government has overruled the proposals.

As a result from next October, employers will have to keep records of how long they have employed agency workers, to ensure they comply with new laws giving temps many of the same employment rights as full-time staff.

CBI senior policy adviser, Nicola Walker, said that under the regulations, equal treatment is granted after 12 weeks in a job, but the regulations include a six-week break period before the 12-week clock resets.

For example, if an employer had a temp working for them, they can’t get around the regulations by letting them go for a week or two after the 12-week period and bringing them back in without giving them equal treatment. The break period means that the temp would need to have a six week break from working for that employer, before the 12 weeks without equal treatment would start again.

“This is too complex for employers using short-term workers such as drivers, who may only work for half a day at a time,” said Walker. “It’s hard to keep track of which workers they have used, so we would like to see a shorter break period for these workers to reduce the paperwork.”

The regulations also define pay to include bonuses, so employers will be forced to give temps performance related appraisals. “We think this is unnecessary, and we would like to have seen it simplified,” said Walker. “We suggested that if other staff are getting bonuses, temps could just be given the average amount.”

Croner senior policy consultant, Carol Smith, said that employers should review their use of agency staff in preparation for the regulations.

“If a firm uses a lot of agency staff, it needs to look at its administration processes,” she said. “Managers will have to monitor and record HR information to make sure people aren’t employed for longer than 12 weeks without getting equal treatment,” she said. “A better solution for them may be to use more self-employed workers.”