Temp industry to suffer from new regulations

The use of ‘temps’ in offices up and down the country will noticeably diminish towards the end of 2011 as businesses stop hiring them ahead of new rules coming into force, say several employers’ groups.

The warning comes after unpublished research conducted by a leading business group shows one in five employers plans to stop using temporary workers altogether in order to avoid costly legislation coming into force on 1 October 2011.

The legislation will give temporary workers the right to the same pay and working conditions as permanent staff after they have been in the job for just 12 weeks.

Temps have long been used in the UK’s workplaces as a handy way of filling a gap in the workforce on a temporary basis. Temps are often brought in to cover employees on maternity and paternity leave, or those on sick leave. In addition, they can be called in to cover a position during sabbaticals or lengthy recruitment processes.

Temps, or agency workers as they are also known, do have the same statutory employment rights as permanent employees in their temporary place of work. For example, they are protected by anti-discrimination legislation, are entitled to the national minimum wage, paid holiday, rest breaks and limits on working times, and protection under the health and safety in the workplace laws.

However, they have not necessarily been entitled to the same benefits as their permanent co-workers, unless this is specified in their contract.

The new legislation being introduced in October this year will ensure the UK’s 1.3 million temporary workers are entitled to the same level of pay as their full-time counterparts and that they receive the same benefits, such as the same rate of holiday pay. Pregnant agency workers will also be entitled to paid time off to attend medical appointments and antenatal classes.

The changes are being implemented as the result of a piece of EU legislation, by which the UK must abide.

However, although the new regulations are intended to give temporary workers more rights in the workplace, it may inadvertently cause them to end up without a workplace at all.

Employers’ groups are arguing that the legislation will be expensive for employers and therefore fewer will be hiring temps in their workplaces. This could lead to an increase in unemployment during a time when the Government is urging the private sector to reduce unemployment and kick-start the economy.

Employers’ groups who have warned over the effects of the new rules include the manufacturers’ body EEF, the British Chamber of Commerce (BCC), and the Institute of Directors (IoD).

David Frost, the director general of the BCC, said: "Many firms tell us that the new directive will mean they will use fewer agency workers. Since businesses use temporary workers to improve the flexibility of their workforce and to cover any short-term periods of increased demand or staff absence, it is reasonable to assume these jobs will be lost and productivity hit."

For more information on the changes to temporary worker regulations, you should speak to an expert employment solicitor. Job Justice works with employment solicitors throughout the UK and can recommend a local expert who can assist you with the transition in October 2011.