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New regulations could lead to the demise of seasonal workers to the detriment of Yorkshire business

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Legislation due to come into force later this year could make the cost of hiring agency workers prohibitive, so harming the flexibility of UK businesses.

Legislation due to come into force later this year could make the cost of hiring agency workers prohibitive, so harming the flexibility of UK businesses.

On average, more than 67,600* agency workers are employed in Yorkshire, this equates to about 102 per business, primarily in the hospitality and manufacturing sectors.  Traditionally, they have been used to give flexibility, enabling companies to respond quickly to seasonal or market changes without the commitment of recruiting permanent staff.  However, the Agency Workers Regulations 2010, due to be implemented in October, threaten to change this.

“During the recession, agency workers have proved invaluable to many businesses, providing a pool of skilled individuals without the risk and ongoing costs of permanent employees,” explains Sarah Tahamtani, partner in Clarion’s employment practice. 

“The legislation follows lengthy consultation and aims to protect agency workers who the government felt were vulnerable to exploitation.  However, the burden the new Regulations place on businesses may, in fact, lead to less or no work for agency workers and with their demise, firms losing the flexibility to quickly respond to market changes.”

Under the new legislation, from the agency workers’ first day, they will have equal access to collective facilities and an entitlement to be informed of any permanent vacancies.  In addition, providing that the agency worker has completed 12 weeks’ continuous service, they will be entitled to the same basic working and employment rights as permanent staff.   The Regulations will also entitle agency workers to the same pay (including performance-related bonuses), rest breaks, holidays and duration of working time as comparable permanent staff. 

“These measures will have huge financial consequences for business and will also require new procedures to be put in place, such as appraisal systems for agency workers to ensure they are being treated in the same way as permanent staff.  The agency will bear the brunt of the liability for any breach, leading to an increase in their charges, but the hirer can also be liable.  Agencies may even seek to change the commercial agreements they have with clients to ensure that their additional liabilities are shared.

“Companies must be aware that it is not possible to circumvent the Regulations by structuring assignments which avoid the 12 week service and, in fact, anyone doing so is liable to face a fine of £5,000.

“As a result it is important to consider what steps should be taken in readiness for the changes and identify other possible solutions to temporary increases in demand.  Put simply, agency workers will no longer be a quick and simple temporary ‘fix’.”

Article featured in The Yorkshire Post, Monday 11 April 2011

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For further press information, please contact:

Susan Reid on (01423) 56 99 99 or susan@appealpr.com

Editors Note

*figures taken from REC Census 2006