Rules intended to protect temps are having the opposite effect

As South Africa is pushing the Labour Bills into Parliament, in UK’s new Agency Worker Regulations, one of the hot issues “same pay and benefits as permanent workers” is resulting in an opposite effect. 

Extracts from The Telegraph article

Under the changes, which stem from European law, temps are entitled to the same pay and benefits as permanent workers after just 12 weeks in a job. Previously, they had to wait one year to clock up employment rights. ( SA has proposed 6months. We should be doing one year)

A Government analysis said the new rules would cost firms £1.8bn (over R10bn!) a year to implement, raising fears that cash-strapped businesses would stop hiring temps as it no longer made commercial sense. A typical small business would have to pay an extra £2,493 a year, increasing to £73,188 for larger companies. (Experts in SA have always been saying more people, if not more households will suffer as a result)

The new 12-week rule also damages temps’ flexibility to cover peaks and troughs in demand, experts said.

Scores of employers have revisited how they will use temps following the new rules, and are either recruiting fewer agency staff or urging them to waive their rights under a legal loophole. (This is one of my fears for the SA market)

Tom Hadley, policy director at the REC, said the decline in temp hiring “may in part be linked to employer uncertainty over the agency worker regulations”. (Unfortunately this has already commenced in SA without even the bills finalised)

The number of people placed in short-term jobs fell in March at the fastest rate for two-and-a-half years, research from the Recruitment and Employment Confederation (REC) and KPMG revealed. (The Namibia case comes to mind. SA should bear this in mind)


Credit to worradmu for the image

Credit to worradmu for the image

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