Tuesday, 4 December 2007

Europe’s temps set for full benefits

It looks like the UK is going to lose the battle in Brussels over a new law that would give temporary workers the same rights as full-time staff.

A government source told The Times today that the issue is being linked in with the working-time directive restricting employees’ hours, and that given the fact that only four EU countries oppose the measure as a whole, Britain will be forced to accept the change under qualified-majority voting rules at a council of ministers meeting tomorrow.

Business interests in the UK have been vocally against the measure, saying that the law could force companies to get rid of as many as 250,000 jobs if they were forced to give full benefits to their temporary employees. However British unions have been busily debunking this argument and have been pressuring the government to drop its opposition to the changes.

The British government didn’t drop its opposition, yet it appears it still lost. It is not insignificant that the UK was able to make such little headway on this issue in Brussels. In a multi-national entity that works on consensus, it isn’t terribly surprising that the EU member states have failed to be swayed by their unwilling partner across the English Channel.

Whether or not this legislation will actually have the negative effect in the UK that some business groups are claiming is hard to gage. Considering that ‘benefits’ in a European context usually means holiday time, working hours and pay scale rather than healthcare, it’s hard to imagine it would.

One could argue that it makes sense that a temporary employee from an agency would receive pay on a different scale, or work different hours, than a full-time employee. But the problem is, if businesses are allowed to set drastically different schemes for full-time workers and temps, the system can be easily abused. Such is the situation in the US, where companies are increasingly setting up elaborate systems of temp-hiring to avoid paying health care contributions for their workers. Given that I have many friends in the entertainment and journalism fields, I would estimate that a good half of my US friends fall into this ‘agency worker, no health insurance’ category (especially those that work for broadcast networks), even though they work full-time for a company. It’s simple: the company designates you as an outside employee of an agency working for them (the fictitious “Yoh Company” for NBC comes to mind), and therefore they don’t owe you any benefits.

That, fortunately, is not a widespread practice in Europe. But in an increasingly global and competitive economy, it’s hard to see how it wouldn’t turn into a temptation if companies are allowed loop holes by artificially shopping out some functions to agencies. If the government mandates that temp workers be treated the same as full-time workers, there would be no motivation for companies to do this.

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