News

Government statement on Agency Worker Regulations – ARC initial response.

Date: 22 Jan 2010

The Association of Recruitment Consultancies (ARC) has given a mixed response to the government statement of policy published yesterday that final regulations are to be laid before Parliament immediately.

The regulations are intended to give agency workers equal entitlements to pay and leave arrangements as if they had been recruited directly by their hirer, following an EU Directive finalised in December 2008.

Adrian Marlowe, chairman of ARC, said “there is little to be jubilant about as yet and I reserve my judgment until I have seen the final regulations, which I understand are to be published later today. The regulations necessarily are complex, have the capacity to affect other areas of law, and the potential to affect the viability of agency work as we know it. For those reasons, and because of the many anomalies in the original draft which we had addressed on our response last December, we had urged the Government to publish the final regulations for comment before laying them before Parliament. Regrettably this has not happened, and I hope therefore that the Regulations do actually lead to a fair result.

What can we take from it so far? There appear to be some positive wins. The draft regulations contained proposals for all transfer fees, not just temp to perm, to be limited by a “reasonableness” test. The transfer fees that recruiters can charge include temp to temp, and the test was also proposed to cover the extended periods of hire that a recruiter must offer to hirers in place of a fee. Uniquely we saw this recruiter specific proposal as highly dangerous for the temp contracting industry, leading to a potential blood bath as hirers switch workers from one agency to another, and we mounted a detailed and well publicised campaign to stop it. I am therefore very pleased to see that the Government statement indicates plans to drop the test in any form and to scrap the proposal leaving the transfer fees regulations unaffected.

Also the policy statement in certain areas also indicates an acceptance of key points of principle, relating to the distinction between agency work and employment, which we had highlighted in our response to the 2nd consultation. For example, on the issue of pay we are told that included bonuses are to be defined in a more sensible way. This is very welcome and again would more reflect the reality of the agency relationship.

However in all these areas the jury must be out until the detail can be seen, and we are not jumping to any conclusions.”