Since its proposal by the EU Commission in March 2002, the draft Temporary Agency Workers Directive giving equivalent rights to temporary agency workers as to employees has caused difficulties and has been heavily scrutinised in particular by UK employer lobby groups. This is not surprising as some estimates suggest that as many as 1/3 of all agency workers in the EU are based in the UK and that recruitment agencies are more established in the UK than anywhere in the EU. On 20 May 2008, an agreement was brokered by the UK Government between the CBI and the TUC to give equivalent rights to temporary workers after 12 weeks in a given job. The sticking point of negotiations between the parties had been how fairer treatment for agency workers should be promoted, while not removing the important flexibility that agency work can offer both employers and workers especially in the current economic climate. This agreement was an important precursor to the EU Council meeting in Brussels on 11 June 2008 where EU ministers agreed the terms of the draft Directive for temporary agency workers setting out the types of agency workers covered, the qualifying period and the rights and conditions granted to them.
What sorts of ‘agency workers’ will be covered?
The Directive applies to ‘workers with a contract of employment or employment relationship with a temporary agency, who are assigned to user undertakings to work temporarily under their supervision and direction’.
Therefore the Directive does not apply to the genuinely self-employed. The three components are:
(1) under employment contract with agency;
(2) on a temporary assignment;
(3) under control of the user.
The third issue may be most problematical in practice, or give scope to claim that the Directive does not apply. What happens if agency workers actually work for an end user but are not under its control (supervision and direction) in some situations such as outsourcing situations (e.g. call centres), where there may be different management?
What sorts of rights are covered?
The purpose of the proposed Directive is to ensure ‘the principle of equal treatment’. Equal treatment will be defined to mean at least the basic working and employment conditions that would apply to the workers concerned if they had been recruited directly by that undertaking to occupy the same job.
‘Basic working and employment conditions’ are defined in the proposed Directive as ‘working and employment conditions laid down by legislation, regulations, administrative provisions, collective agreements and/or other binding general provisions in force in the user undertaking relating to:
(i) the duration of working time, overtime, breaks, rest
periods, night work, holidays and public holidays;
(ii) pay.
The proposed Directive also provides that agency workers shall be given access to the amenities or collective facilities in the user undertaking, especially canteen, childcare facilities and transport services under the same conditions as workers employed directly by the undertaking, unless the difference in treatment is justified by objective reasons. However it does not cover other employment law rights. Neither the UK agreement or the proposed European Directive give unfair dismissal rights or redundancy rights to agency workers against the business to whom they supply their services (the ‘end user’). The terms of the proposed Directive therefore does not change fundamental employment laws but simply provides for equal treatment in terms of pay and basic employment conditions for agency workers.
Member states can decide whether company schemes including pension, sick pay or financial participation schemes are included in the basic working and employment conditions. This means share options and profit related pay are unlikely to be covered in UK. However, we need to wait for the draft Directive’s implementation into the UK to see whether shift premiums, overtime pay and attendance allowances will also come under the definition of ‘pay’.
Interestingly there is an exemption from social security schemes in the proposed Directive as regards pay when temporary agency workers who have a permanent contract of employment with a temporary agency continue to be paid in the time between assignments. This may be an interesting loop hole where agency workers are paid irrespective of whether they are actually working.
Is there a qualifying period for equal treatment?
The proposed Directive assumes equal treatment from the first day of work. However, it allows member states to make their own arrangements in certain circumstances and such arrangements may include a qualifying period for equal treatment which the UK has made at 12 weeks. This follows the agreement reached between the CBI and TUC in May this year.
The proposed Directive does not help with the meaning of the timing threshold as it does not deal with this. Is it 12 continuous, unbroken weeks? Does in ‘a given job’ actually mean the same job or does it really mean the same end user? What happens if the end user circulates agency workers within the same organisation giving them different jobs every 12 weeks? When does equal treatment commence? From 12 weeks and one day? What happens if the job is always scheduled to last more than 12 weeks? Should equal treatment start on the first day or only after 12 weeks? There remain many unanswered questions.
When will the proposed draft be implemented in the UK?
The text of the proposed Directive must now be formalised by the European Parliament into a Directive on temporary agency work before implementation into national domestic law. At present, it is understood that the UK Government wants the UK Regulations in force by the next election (which can be no later than June 2010), so timing may be an issue, depending when the final EU directive comes into force. However, 6 April 2010 seems a possible implementation date but it cannot be properly predicted as the passage of the Agency Worker EU Directive is likely to be linked to the new Working Time Directive which was announced at the same time. In particular, the UK has issues about preserving its opt out. The existing Working Time Directive has been discussed for some years and many member states are in breach of the current directive according to the European Court of Justice.
The general aim of the draft Directive is to establish ‘a protective framework for temporary agency workers […] whilst respecting the diversity of labour markets and industrial relations’. 8 million workers in the EU are estimated to be temporary agency workers and the numbers are increasing which highlights the importance of this proposed draft Directive for a growing proportion of the EU’s labour force. However many key elements of the draft Directive’s text remain ambiguous such as the types of agency workers covered, the detail of the qualifying period and the rights granted which leaves employers unclear as to the impact it will have on their organisation. It remains to be seen whether clarity will be achieved before the draft Directive is implemented in the UK.
