CWS 3.0: August 17, 2011 - Vol. 3.20

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Europe: Corrections, Confusion and Contradictions

Between dealing with media scandals and combating riots, the U.K. government has found some time to tidy up a few loose ends in relation to the Agency Workers Regulations (AWR), due to come into effect Oct. 1.

Despite the endless consultation and redrafting of the text, the final Regulations contained three flaws; a new statutory instrument, laid before Parliament on Aug. 3, has corrected them: 

  • Regulation 14 has been amended in order to clarify the information a staffing company must obtain (or taken reasonable steps to obtain) from the end-user (in order to avoid liability. The amendment clarifies that agencies need only seek information regarding the basic working and employment conditions of the employee the temporary worker is being compared to (rather than undertake a complex analysis of the client’s whole workforce in order to establish the correct rate of temporary pay). This amendment will help staffing companies to better establish a defense showing that they have met their obligations under the AWR by asking for the correct comparator pay information (and acting on that data to equalize pay). 
  • The definition of "agency worker" has been tweaked to clarify that the agency worker does not need to be providing personal services "for the staffing company" as opposed to the hirer.
  • Finally, a minor error relating to "Swedish Derogation" has been fixed. The uncorrected text created an anomaly that would arise if there was no break in an assignment, leaving the employer unable to comply with the conditions required to avoid the agency worker's entitlement to equal pay by way of Swedish Derogation. The new amendment addresses that issue to a large extent by providing that the obligation only arises after the end of the first assignment under the employment contract.

Staffing suppliers and buyers of staffing services should have a little more confidence in the AWR following these corrections — although perhaps they might have more confidence if the Statutory Instrument hadn’t misspelled the name of the authorizing Minister for Employment Relations, Consumer and Postal Affairs, Ed Davey MP, as “Eds Davey”!

Misconceptions

Meanwhile, in the lead up to the introduction of the AWR, various opinions are forming relating to employers’ preparedness to implement the AWR and what it will imply for temporary labor demand.

According to research published by Adecco on Aug. 9, many employers remain confused about the implications of the AWR. The survey of nearly 500 HR professionals found that respondents were particularly unclear about the impact of temporary workers’ benefits, including holidays and bonus eligibility — more than half (55 percent) wrongly think that the regulations entitle temporary workers to exactly the same benefits as permanent staff, and almost a quarter mistakenly believe that they will accrue all the same employment rights from day one of an assignment. Employers are also unclear as to who is ultimately responsible for ensuring compliance with the new rules — more than a quarter (26 percent) incorrectly believe that the responsibility for ensuring adherence to the new rules lies solely with the temporary staffing agency that provides the workers, whereas in fact the duty is shared.

Meanwhile, the Sunday Telegraph on Aug. 7, reported that unpublished research from a leading business group shows employers will significantly reduce their use of temporary workers due to the AWR. According to the story, one in five employers is planning to cut their use of temporary workers to avoid costly new legislation, which they believe will drown the U.K.'s flexible temping industry. The REC, which represents the staffing industry in the U.K., refutes this report. According to the REC’s data, 79 percent of businesses intend to maintain or increase their use of agency workers in the next year, while only 5 percent intend to significantly reduce numbers. The REC claims that “even in the sectors where temps are most heavily used, such as industrial and drivers, recruiters are speaking to their clients about the new regulations and do not expect to see a significant drop-off in demand.”

Research members requiring further information should refer to our research on how to prepare for the AWR and what the Guidance on the AWR means to you. We will also be covering further development in the European Daily News, if you are not already signed up for this News, please follow this link.

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