The issue of extending employment rights to temporary and agency workers has been controversial. Yet, after years of delay in progressing the Temporary Workers Directive, a joint agreement which has just been reached between the government, CBI and TUC could mean that rights for temporary and agency workers are now a little closer.

The principle behind the Directive is clear - to prohibit discrimination against  temporary and agency workers so that terms and conditions relating to remuneration, paid holiday, working hours, overtime, maternity and anti-discrimination provisions are no less favourable than if the individual had been recruited directly by the client organisation.  However, progress on the Directive has been extremely slow.  Part of the reason for this is the contentious issue of what, if any, qualifying period of employment there should be before employment rights are gained.  Some member states are of the view the qualifying period should be one year, others consider it should be no more than six weeks.  Many trade union organisations on the other hand believe that employment rights should accrue from the first day of employment.

Following publication of a Private Members’ Bill (the Temporary and Agency Workers (Equal Treatment) Bill) the government’s response was to set up an independent commission in February 2008 to consider what rights and protection should be offered to temporary and agency workers.  The commission brought together both the CBI and TUC to consider the issue.  The CBI had suggested that the qualifying period of employment should be at least six months, but the TUC argued that this would leave many thousands of temporary and agency workers outside the scope of the legislation.

This week the government announced that it had reached an agreement with the CBI and TUC, whereby temporary and agency workers will have an entitlement to equal treatment to comparable permanent workers after 12 weeks’ employment.

The agreement defines equal treatment as "at least the basic working and employment conditions that would apply to the workers concerned if they had been recruited directly by that undertaking to occupy the same job."  Whilst this does mean an entitlement to the same pay and holidays as permanent workers, it is important to note that the agreement does not cover sick pay or pension entitlements.

The intention of the agreement is to provide fairer treatment for temporary and agency workers in the UK whilst at the same time retaining the flexibility that agency work provides for both employers and workers.  It is worth pointing out that, according to the CBI, half of agency placements last for fewer than 12 weeks and so will be unaffected by the agreement. This will be of particular significance to (for example) those organisations which need to fill short term, seasonal vacancies. 

So what happens next? The current presidency of the EU is with Slovenia and on 19 and 20 June there is a European Council meeting at which the government will seek to reflect the terms of the agreement in the Directive.  It will also work with other member states regarding implementation of the Directive generally so that the agreement can be brought into legal effect in the UK.  In addition, the government will consult specifically on;

• mechanisms for resolving disputes regarding the definition of equal treatment and compliance with the new rules that avoid unnecessary administrative burdens for employers and delays for workers, and

• appropriate anti-avoidance measures, for instance, in relation to repeat contracts for the same worker.

France takes over the presidency of the EU in July and is committed to reviving discussions and negotiations on the Directive. So, after many years of stalemate (the Directive was introduced back in March 2002), there are likely to be further developments shortly. We will keep you updated on these.

Finally, following the agreement reached between the government, CBI and TUC, it has been confirmed that the Private Members Bill has now been withdrawn.