Many European countries enforce strict controls on temporary workers, but an REC delegation aims to break down barriers on the issue. Julian May reports

The Recruitment and Employment Confederation (REC) will lead an industry delegation to Brussels in June in a bid to break down barriers over European attitudes to casual workers.

The move follows fears over creeping regulation from Europe on the employment of casual workers and the threat to the industry should they be given the same rights as employed staff.

The REC will join its European trade body equivalent Eurociett and Continental trade union body Uni-Europa to lobby politicians, encouraging them to accept that recruitment agencies play an active role in the labour market, help reduce unemployment and create a more flexible workplace.

As well as breaking down the barriers and making European labour markets more accessible for recruitment agencies, their discussion will concentrate on beefing up regulations in countries where workers are exploited by unscrupulous gangmasters, to create a cross-boundary agreement.

The private employment agency industry is one of the largest private employers in Europe, employing 3.3m agency workers every day in 2006, accounting, on average, for 1.8% of European total employment.

While there has undoubtedly been much progress in EU countries accepting the value of agency work, barriers remain in terms of restrictions and discrimination. The European Commission and the International Labour Organisation (ILO) have identified employment agencies as an "essential element" in the common principles of 'flexicurity' — flexibility in the labour market combined with security and an active labour market policy, with rights and obligations for the unemployed.

The EU Employment Council also recognises the contribution agency work provides in the labour market, concluding last December: "Temporary agency work is seen as a key factor in meeting the requirements of the Lisbon Strategy, as it contributes to increasing both employment and competitiveness."

But it has already been five years since the European Employment Task Force called on EU member states in 2003 to "work towards the removal of obstacles to temporary work agencies". The EU draft temporary agency workers directive is still dividing countries six years after it was first mooted. But with European elections in 2009, could 2008 be the year the agency workers debate is finally resolved?

Engine of job creation

Eurociett carried out a study of the six largest European markets in Belgium, France, Germany, Netherlands, Spain and the UK, which jointly accounted for around 85% of EU agency work in 2006.

The study concluded that "this engine of job creation" could see the number of agency workers grow to 4.98m by 2012 through structural growth. A further 570,000 could be added in the six countries if restrictions on temporary agency work are lifted.

Several countries severely restrict the use of temporary workers — the most significant of these are in public sector and construction jobs. In Spain, agency temps are strictly banned from both sectors, while in France and Belgium their use is restricted to specific situations. German regulations allow the employment of agency temps in construction, but only if a collective agreement is signed between the employer and the agency, under strict terms and conditions imposed by the government. So far this has never happened.

Eurociett argues that lifting restrictions would help to remedy public sector flexible workforce needs, tackle the problem of skills shortages, and provide the reactivity they need to improve quality of services and reduce demands on the public purse. Supply teaching, for example is fully utilised in the UK and the Netherlands but not in most other European countries.

In Spain, Belgium and France, the use of agency temps within companies must be legally motivated by a 'reason of use', such as replacement of absent workers or to cope with peaks in activities. And the scope and approval process for 'reasons of use' differs across countries.

The report argues: "Lifting these restrictions would strengthen organisations' competitiveness through quicker adaptation to fluctuations in economic activity, while making workers more attractive to employers by providing them with additional experience and skills."

Recruitment agencies still face discrimination in many European countries, which do not allow them to compete with other types of flexible employment on an equal footing. In the Netherlands and Germany, the temporary work sector is the only one required to

arrange collective agreements with trade unions to determine wage conditions for their workers. In the Netherlands, if no collective labour agreement is reached, the agency must apply user pay conditions, essentially denying it the freedom of negotiation.

According to Eurociett: "Unlike other employers, private employment agencies are forced to agree to more stringent demands from the unions in order to reach a collective labour agreement."

Research from the Netherlands provides "substantive evidence" that without this, unemployment could be lowered by as many as 25,000 jobs. Eurociett estimates the additional jobs created by reducing restrictions would increase public income by e12.5bn within five years.

The UK has the highest penetration rate across Europe for the use of temps in small and medium-sized businesses — 4.5% compared to a European average of 1.8%. The study concluded a higher use of temps in SMEs can make firms more reactive to economic fluctuations and would lead to the creation of 150,000 extra jobs in SMEs in the six EU countries examined. It also stated that the moves would give temporary workers greater flexibility in managing a work-life balance and in their education or training.

Misconceptions about agency work

Annemarie Muntz, president of Eurociett, says that there are three common misconceptions about agency temps: that they endure worse working conditions than permanent workers; that agency work is a substitute for permanent employment; and that temping puts workers in precarious financial situations and can lead to a poverty trap.

She told Recruiter that temporary agency work is regulated in most EU member states, giving agency workers the same working conditions as permanent staff — working hours, minimum wage, paid holiday, health and safety at work, access to unemployment benefit and social security.

Muntz emphasises the findings of the report's research, which shows that agency workers are very satisfied with temporary agency work (satisfaction rates vary from 70% in the Netherlands; 80% in the UK and Spain, 82% in Belgium and 90% in France).

The report also concluded that agency work creates jobs, rather than substituting permanent positions, adding that 669,000 jobs were created in Europe by employment agencies between 2003-2006.

Eurociett advocates amending the European Union's employment guidelines to involve private employment agencies more closely in labour market policies.

"We need a good [EU] directive which will guarantee the direction of the sector across Europe," she says.

The directive needs to be implemented flexibly, says Muntz, by reducing bureaucracy and the legal risks to agencies. "There are a number of restrictions on the use of agency workers in Europe and that needs to be reviewed and lifted if unnecessary, unjustified or outdated. Article five of the directive and the non-discrimination of agency workers is a big issue — 22 of the 27 states have regulations concerning equal pay."

Muntz says in the Netherlands they have agreements over pay for agency workers, but only pay - not pensions or other benefits — a system which seems to work. She says European recruiters have never been against "good regulation" which protects agency workers. "It is our living looking after workers," she adds.

Muntz says staff retention is the issue of the day and the enforcement of existing laws rather than creating lots of new legislation.

The Netherlands, which abolished its licensing system for agencies 10 years ago, has recently reintroduced a business permit requirement in an attempt to combat large-scale fraud. Muntz says the Dutch government had to put more resources into tackling this problem.

She adds: "The delegation in June will help us learn and share information but we must realise that not one size fits all."

Working with European partners

Tom Hadley, director of external relations at the REC, says the delegation to Brussels will help galvanise support against Andrew Miller's Private Member's Bill, which proposes equal pay and conditions for temporary agency workers.

He told Recruiter: "We're working with our European partners to make sure the British recruitment industry is represented and working towards positive solutions. We will be discussing the agency workers' directive and how things can be made easier to work in countries like Bulgaria and Romania, where there is little regulation."

Hadley says there is little chance of blocking a vote on the agency directive now Denmark has dropped its support for a block and Poland is not sure.

"We need to work with other countries to come up with positive solutions," he says. "We know the French will be driving the directive when they take the EU presidency in July.

"The reality is that whatever the UK government does, they cannot block it on their own because of the qualified majority voting system. What will probably happen is a move towards a compromise."