EU deal for agency workers to see temps gain more holiday and sickness benefits

The warm ale and spam sandwiches sent to Luxembourg by the Federation of Small Businesses had little effect. When European Union employment ministers emerged from their late-night talks earlier this month they announced a deal that could have far-reaching consequences for the 1.3 million agency workers in the UK, 30,000 of whom work in social care. The agreement, once ratified under EU and UK legislation, will mean that after 12 weeks of working, agency staff will qualify for the same pay, perks and holidays (although not pensions) as permanent employees. The deal follows a similar agreement thrashed out last month by the government, CBI and the TUC.

Predictably, the business community has greeted the announcement with reactions ranging from the grudgingly accepting – CBI deputy director-general John Cridland described it as the “least worst outcome for Britain” – to the apocalyptic: “This deal smacks of the 1970s when major decisions were made behind closed doors and trade unions dictated employment policy to the government,” blasted John Wright, chair of the FSB (hence the stunt with the warm ale and sandwiches).

Significant effect

According to Kevin Green, chief executive of the Recruitment and Employment Confederation, the agreement could have a significant effect on the way employment agencies recruit and supply temporary staff.

“This directive will have the biggest impact on recruiters, who will have to make it work for all in practice,” he says. “At this stage, it is too early to gauge its exact impact and we will be working hard to ensure that, when this directive is implemented in the UK, it does not have a negative impact on the provision of temporary workers.”

The unions, on the other hand, have welcomed the deal as the culmination of years of campaigning for agency workers’ rights.

“This is a great step forward to protect the majority of vulnerable agency workers,” says Unison general secretary Dave Prentis, who, as president of the TUC, led the talks with the government.

“We have been campaigning for these rights for six years and the logjam has at last been broken. Agency workers are becoming an increasing feature of the public sector and we want to make sure they are treated fairly. It cannot be right that, in the 21st century, we still allow unscrupulous bosses to exploit the most vulnerable workers by denying them basic employment rights.”

Unite’s joint general secretary, Tony Woodley, described the agreement as a landmark for agency workers and GMB general secretary Paul Kenny said he looked forward to “putting the meat on the bones” of the agreement with the CBI and government.

However, before agency workers break out the champagne, there are several issues to be addressed. First there is the timescale. Before the new rights come into force they must pass through the legislative processes of both the EU and the UK government. This is unlikely to happen before 2010.

Financial implications

Then there are the financial implications. The Local Government Association, while welcoming any move that attracts more people into the social care workforce, has pointed out that someone will have to pay for these new rights.

Finally, there is the question of how the agreement will work in practice. If an agency worker and a permanent staffer are doing the same job, there should be no problem in equalising pay. But often there will be no direct comparison with an agency worker’s role. One attraction of agency work is the opportunity it provides for highly flexible working arrangements. Many agency workers are on the books of a number of employers in different roles and it may not be possible to compare like with like.

There are also unanswered questions as to how the new agreement will affect agency workers employed directly by service users under direct payments or individualised budgets, or how it will affect the long-term agreements in operation between local authorities and their current contractors.

Peter Cullimore, chair of the Recruitment and Employment Confederation’s nursing and social care sector group, says: “At the moment we don’t know the details of how it’s going to work in practice and there may be several indirect consequences that haven’t been thought through.”

Cut back on staff

Cullimore’s own agency, Universal Care, provides home care services to local authorities in Buckinghamshire and Berkshire. He is concerned that the new agreement could encourage social services departments to raise their eligibility criteria as they cut the number of temporary workers.

He says: “I would hope that local authorities don’t cut back on their agency staff because all the figures show that, economically, it makes sense to use agencies. They are flexible, efficient and highly cost-effective. But if they do make that decision then obviously with the costs of care to local authorities going up and budgets becoming tight, it is possible that they will tighten their eligibility criteria. And that, of course, will affect service users.”

At the heart of this issue is the growing reliance by social care on the use of agency workers. It has long been one of the major complaints of service users that the high turnover of staff, many of whom are temporary workers, severely reduces continuity of their care. Local authorities have come under pressure to improve their recruitment and retention of permanent staff and thereby reduce their reliance on agencies.

In 2006, the Department of Health document Options for Excellence – Building the Social Care Workforce of the Future promised that, by 2020, employers would no longer be relying on temporary staff to cover tasks that would normally be carried out by a permanent social care worker and that clients of social care services would have continuity of care. The report suggested initiatives such as developing local and regional non-profit agencies to provide local authorities and other employers with a flexible staff supply and to reduce reliance on staff supplied by commercial agencies.

But a recent survey by the GMB union suggests there is still a long way to go. Using figures obtained from 424 local authorities under the Freedom of Information Act, the union estimates that councils are spending £1.7bn a year on agency staff. The figures for the 2006-7 financial year show that some local authorities spent more than £50m a year on temporary employees.

“This is a horrific abuse of the public purse,” says Brian Strutton, GMB national secretary for public services. “The point is that this is more than just filling in gaps. On this scale it is a deliberate scam. Too many councils are using cheap temps when they should be recruiting permanent staff who can be properly trained and given the experience that is necessary to provide quality local services to the public.”

Right to recruit

The LGA insists that councils must retain the right to recruit staff, both permanent and temporary, according to local needs. The new EU agreement should not be allowed to affect that, it says.

“Different councils have different needs and will recruit their staff accordingly. That’s what local government is all about,” an LGA spokesperson says.

Bernard Walker, director of adults’ services at Wigan Council and co-chair of the Association of Directors of Adult Social Services workforce development network, is also confident that social services departments will continue to employ agency staff when they are needed. “We already have contract specifications that cover the treatment of agency staff so I don’t think it’s going to be an issue,” he says.

Indeed, Walker believes that if the EU agreement gives agency staff increased confidence over their job security and prospects that could have a knock-on effect of increasing the continuity of care for service users. “If this provides better security for agency staff then that should contribute to more consistency in services and we would welcome that,” he says.

According to a report published last year by the TUC, agency workers in the UK continue to be paid less and be engaged on worse terms and conditions than directly employed workers in the same organisation. The new EU agreement should go some way to resolving these inequalities. But on the swings and roundabouts of employment law it is to be hoped that these equal rights do not come at the cost of reduced opportunities or a declining standard of care.

● Further sources 

Recruitment and Employment Confederation

The Trades Union Congress

Options for Excellence – Building the Social Care Workforce of the Future

● Community Care coverage of agency staff employment issues:

Guide to hiring agency staff

Pros and cons of agency working

How the news of the EU deal broke: John Hutton’s announcement

This article is published in the 26 June issue of Community Care under the heading Workers’ Playground?