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New benefits for temporary workers could harm small businesses and cost jobs
Archived article dated Tuesday May 20th 2008
The Forum of Private Business (FPB) is warning that proposals to hand temporary workers the same benefits as full-time members of staff could make many small firms uncompetitive and lead to greater unemployment.
Under the proposals, which have been agreed by the Government and unions, temporary workers would enjoy the same pay and holiday entitlement as permanent employees after completing 12 weeks' service in the same company.
The FPB disagrees with Secretary of State for Business, Enterprise and Regulatory Reform John Hutton, who insisted that the agreement represents "flexibility for British employers and fairness for workers". The FPB is concerned that flexible labour market - which often benefits temporary staff and employers alike - could instead be seriously undermined.
"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," said the FPB's Chief Executive, Phil Orford. "Increased costs and bureaucracy is an unwelcome burden for our members at a time of financial uncertainty, and we fail to see how these measures fit in with the Government's plans to reduce red tape for small firms by 25% by 2010."
The plans originally focused on placing agency workers on an equal footing with full-time staff after just six weeks' employment, but extended this period after a backlash from a number of organisations, including the FPB. However, the compromise does not go far enough to ease the blow for small firms.
Using agency staff to cover absences because of maternity leave, for example, is likely to become far less attractive for smaller firms. The added costs and red tape involved in employing temporary workers could leave many small businesses with serious staffing problems.
Discussing the Temporary and Agency Workers (Equal Treatment) Bill, the Liberal Democrat's Small Business Spokesperson, Lorely Burt, said: "Many people choose agency work because they value the flexibility and increased employment opportunities it brings. Companies need temporary workers to cover staff absence and recruitment gaps."
She added: "The Government must reassure these workers and businesses that clamping down on unscrupulous companies will not be at the expense of a flexible labour market."
The Conservative Party's Shadow Minister for Business, Enterprise and Regulatory Reform, Jonathan Djanogly, opposed the agreement outright and highlighted the huge costs involved.
"The cost burden of any Bill is of utmost importance to the taxpayer. While I make it clear that the official opposition oppose the Bill outright, and will take that position in Committee tomorrow, we thought it especially important to highlight the measure's huge cost implications, which, to date, have been overlooked by its promoters and the Government," he said.
The move hinges on EU member states first agreeing on the EU's Directive on Working Conditions of Temporary (Agency) Workers. The Directive, which has been on the European agenda since 2002, is being voted on in the Council of Ministers. A decision is expected later in 2008.
Tagged as: temporary workers | act | parliament | legislation | retail | employees | retailing
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