Agency Workers Directive could ‘hamper economic recovery’

Britain’s commitment to the EU’s Agency Workers Directive could impede the UK’s economic recovery and lead to a surge in false tribunal claims, the British Chambers of Commerce (BCC) has warned.

In a letter to the Business Secretary Lord Mandelson, the lobby group suggests delaying the implementation of the Directive in Britain until October 2011.

‘One in four businesses in the UK use agency workers, rising to one in two for the largest companies so implementation of the Directive will clearly have a big financial impact,’ argued BCC Director General, David Frost.

‘It is imperative that implementation is delayed until the last possible common commencement date, October 2011. Implementing earlier risks crippling the agency sector, hampering job creation, and stifling economic growth.’

The Agency Workers Directive was passed by the European Parliament in 2008. It gives temps the same guarantees as permanent staff in terms of pay, working hours, maternity and annual leave from the day they join the company.

However, earlier negotiations between unions and employers mean agency workers in Britain will only acquire such rights after 12 weeks.

According to the BCC, when the Directive is implemented it will be one of the most costly regulations to British business in the last 10 years, with an annual burden on the private sector of at least £1.5 billion.

The Government launched a consultation on the plans in May of this year, and responses were required by 31 July.