Agency Workers Directive shows EU is not reforming
10 June 2008
Open Europe today condemned the EU’s decision to restrict flexible employment by passing the Agency Workers Directive. After resisting the Directive for several years, the UK and other liberal member states were forced to accept the Directive last night. The Directive gives temporary workers the same rights as permanent staff. At the same meeting the UK also failed to secure a permanent exemption from the EU’s Working Time Directive, which the Government had promised in return for giving way on the Agency Workers Directive.
Mats Persson, a spokesman for Open Europe said:
“Eight of out ten of the people affected by this law will be in the UK. It is a backwards step to the 1970s, and will mean fewer jobs, just at the point when we need them most.”
“This shows that the EU is not reforming. Instead of trying to make the EU as a whole more competitive, EU ministers seem more concerned about raising the costs of their rivals. We need flexibility and light regulation, if the EU is to survive in the 21st century.”
“The Directive seems designed to lock member states into a corporatist way of doing business. Since when did we have ‘official social partners’ in the UK? Europe should be moving towards a more flexible labour market model, which has created jobs, not the rigid model which locks in high unemployment.”
“This deal would fall through if the TUC backs out of the agreement, and in this case the UK would be covered by the general rule in the Directive which means giving temps the new rights from day one of their employment.”
Background
The EU is failing on employment
The EU is 17 million jobs away from the employment target it set itself in the Lisbon Agenda. According to a study for the European Commission, by 2050, the EU’s share of world trade could be cut in half.
The agency worker sector has huge potential for job creation and for strengthening Europe’s competitiveness, but remains heavily regulated. Earlier proposals included provisions to lift unnecessary restrictions on agency work across Europe. It is estimated that such a move could create hundreds of thousands of new jobs within the EU. However, the agreed Directive includes no such provisions, but still keeps the costly aspects of the regulation.
UK biggest loser from the package deal
The UK will be the biggest loser from the Agency Directive – by far. There are currently around 3.4 million “full time” agency workers across Europe (8 million overall). Of those, close to 1.3 million are employed in the UK.
The proposed Directive would require 11 member states to change their rules for employing temporary workers. Based on the number of temp workers and the extent of the changes required, 77% of the impact of the Directive will be in the UK.
In 2002, when the first draft of the Directive was tabled, the CBI argued that the qualification period should be 18 months and that pay should be completely excluded.
The UK failed to get what it wanted on Working Time
The UK also failed to secure a permanent opt-out from the EU’s 48 hour working week – which was supposed to be the whole reason behind accepting the Agency Directive in the first place. In 5-8 years time, the opt-out will again be subject to review. In addition, the European Parliament is yet to have its say over whether the UK should keep its opt-out – in the past the Parliament has made clear that it wants the working time opt-out to be scrapped.
Things could get worse still
Flexibility for employers could be further reduced as the Directive passes through the European Parliament, and many MEPs want to see the rules tightened further, and the scope of the Directive widened.
In the UK, temporary workers will gain the rights of permanent workers after twelve weeks, under a deal agreed by the CBI and TUC. However, this deal will fall through if the TUC backs out of the agreement, and in this case the UK would be covered by the general rule in the Directive which means giving temps the new rights from day one of their employment.
Notes for Editors
1) For more information please call Mats Persson on 0207 197 2333 or 07799 460691.