Government delays introduction of employment regulations

The government has chosen to put back the implementation of the EU temporary worker’s directive until the last possible date in an effort to maintain labour market flexibility.

The Department for Business, Innovation and Skills (DBIS) has said that there is to be an eight-week consultation on the proposals.

The directive, which will give agency workers many of the same employment entitlements as permanent staff, will not now become UK law until October, or even December, 2011.

What’s more, small businesses with no pay scales or comparable employees will be effectively exempt from the regulations.

Elsewhere on the legislation front, it seems likely also that the government will drop the rules that would give workers the right to take time off for civic duties.

While to support smaller firms, businesses that employ fewer than 250 staff will be granted a year’s exemption from forthcoming legislation intended to guarantee the right of employees to request time off to train.

Although the announcement of a consultation on the EU Agency Workers’ Directive does rescind the government’s commitment to introduce its rules to the UK, it does provide businesses with as much time as is allowed in order to prepare for the new laws.

Under the Directive, agency workers will be entitled to equal treatment on basic working and employment conditions, including pay and holidays, after 12 weeks on a particular assignment.

Other benefits that agency workers will gain from the first day of their assignment include information about vacancies in the firm they are working for that will give them the same opportunity as other workers to find permanent employment; equal access to on-site facilities such as child care and transport services; and improved rights to protect the health and safety of new and expectant mothers.

Pat McFadden, the Business Minister, said: “Last year the government secured a deal in Europe on the Agency Workers Directive that allows us to base Britain’s rules on the agreement reached in the UK between the CBI and TUC. This allows us to implement the Directive in this country in a way which gives fair treatment to agency workers and maintains labour market flexibility.”

The Minister added: “The government is committed to getting this legislation on the statute book by the end of this Parliament. The law will come into force in the UK in October 2011, giving recruiters and their clients time to prepare and plan. We are also mindful of the need to avoid changing requirements on business until the economic recovery is more firmly established.”

The decision was broadly welcomed by business groups.

Commenting on the announcement, David Yeandle, the EEF’s head of employment policy, said: “We are pleased the government has listened to the concerns of business and delayed the implementation for as long as possible. This decision gives manufacturers more time to prepare for the impact it will have on their business and avoids it being implemented when companies are struggling to recover from the economic downturn.”

David Frost, the director general of the British Chambers of Commerce (BCC), also applauded the delay.

He said: “We recognise that the government has made some changes to their plans to help minimise the burden on business. In particular, we are pleased that small businesses with no pay scales or a comparable employee will be de facto exempt from this legislation.”

But Mr Frost reserved doubts over other unresolved aspects of the Directive, arguing that the definition of pay is still too widely drawn and that the issue of holiday pay runs the risk of causing problems for both employers and agencies.

Tom Hadley, the director of external affairs at the Recruitment and Employment Confederation (REC), commented: “The government has accepted that establishing equal treatment for temporary and contract workers is not as easy as it sounds and that there are a number of practical issues that need to be worked through.

“Our initial analysis of the draft regulations is that there are some real positives – particularly in terms of timing and the scope of what equal treatment covers.”

Tom Richmond, the skills adviser at the Chartered Institute of Personnel and Development (CIPD), welcomed the delay on new training rights for employees in smaller firms.

He said: “The decision to delay implementation of the right to request training for employees in smaller firms, while going ahead with the new laws for larger firms, makes sense in the current climate. Larger firms are likely to be better geared to deal with the new right, while a delay gives smaller firms struggling with the recession more time to prepare.

“That said, CIPD research found that seven in ten firms have continued to prioritise training despite the current recession. Against this backdrop, it is clear that many firms are not waiting on the legislation to take action on training, as they can see the benefits in terms of competitiveness and productivity."