Government says no to AWR review
Government says no to AWR review but agrees to work with REC on definition of self-employed and official guidance
In a statement to the House of Commons yesterday morning, Employment Relations Minister Ed Davey confirmed that the Government would not be reviewing the Agency Workers Regulations (AWR) published last January.
Responding to yesterdays announcement. Kevin Green, the RECs Chief Executive, says:
This was a first big test of the Governments stated commitment to lightening the load on business we are disappointed with the outcome. We made a strong case for a review in our discussions with the Minister. However, re-opening the regulations was always a long shot and would have entailed support from the Trade Unions.
Ensuring that equal treatment measures are workable is not on the Trade Unions radar. Our focus now will be on working closely with Government so that the official guidance provides clarity for recruiters and employers.
There is some upside. Of the three issues that we raised, the Government has agreed to work with the REC on a robust definition and test for legitimate self-employment. We will also be looking for Government support on other priorities for the industry such as pensions reform, vetting & barring, procurement policy and a review of employment tribunal.
Looking ahead at the next steps for recruiters, Green concludes:
Recruitment is a resilient and can-do industry, we will work with clients to minimise the impact of these regulations. Temporary work is about having instant access to highly-skilled, self-motivated workers who make a real contribution. We will get the message to clients that the regulations will not impact on the crucial flexibility that agency work provides.
Written Ministerial Statement - AGENCY WORKERS REGULATIONS
The Government has announced that it will no longer seek to amend the Agency Workers Regulations and will press ahead with producing guidance for employers.
Following a long period of deliberation and consultation, the Government took the view that the legal hurdles to amending the regulation were too great for the amendments to be made within an acceptable time-frame.
The Government believes that the regulations as laid by the previous administration are predicated on an agreement between the CBI and the Trades Union Congress. This agreement, made in May 2008, provides the legal basis for the regulations, as national level agreements with social partners are specifically reference in the European Agency Workers Directive. Despite attempts by the Government to renegotiate this agreement with the TUC and the CBI, the three parties could not come to a new settlement.
In taking the decision not to reform the regulations, the Government cited the need to protect the 12-week qualifying period from potential legal challenges, arguing that it significantly mitigates the burdens the legislation will place on employers.
The Statement, made by Minister for Employment Ed Davey, noted the submissions the Government had received from businesses calling for reform of the regulations, particularly focusing on simplifying definitions and reducing administrative burdens for employers. The Government expressed regret that they were not able to reach and agreement with the TUC and the CBI in order to address these concerns.
APSCo members should therefore expect guidance to be produced by the Department for Business, Innovation and Skills imminently.
Research reveals 80 per cent of HR professionals have no idea what consequences of non-compliance with AWR are
Research from Adecco, the UKs largest recruiter, has found that almost two thirds of HR professionals (61 per cent) dont realise that the Agency Worker Regulations will come into force in just twelve months time and 80 per cent said they have no idea what the consequences of non-compliance are.
The Agency Worker Regulations (AWR) have been designed to give agency workers the same basic working and employment conditions as permanent staff after 12 weeks on assignment. This will have a major impact on how employers use agency workers but Adeccos research found that many HR professionals are still unprepared and even complacent about the impact that the regulations will have on their organisation.
Out of 100 HR decision-makers questioned, 70 per cent claimed they had some level of understanding of the AWR but only 19 per cent said they had a clear understanding. Almost half (48 per cent) said they were concerned about understanding exceptions to the regulations which is a key area in which they could become non-compliant. Despite these concerns, 50 per cent of HRs said that they would not be seeking professional guidance on implementing the regulations.
Steven Kirkpatrick, managing director of Adecco General Staffing, said: Now is not the time for complacency. There are over 1.3 million agency workers out on assignment every day so its vital that HR professionals take steps to understand the nuances of AWR sooner rather than later. This is a significant piece of legislation and getting it wrong could have major resourcing, financial and legal implications. For example, failure to provide recruiters with the right information on temps working and employment conditions could result in a costly employment tribunal which could have major cost and reputational consequences.
Adeccos research also found that the AWR is likely to have a decisive impact on the way in which businesses use agency workers. Where temps make up 10 per cent or more of the workforce, 52 per cent of those businesses said that their organisation wouldnt be able to survive without temporary workers. Almost a third (29 per cent) of HR professionals overall said that they would recruit fewer temps as a direct result of the AWR and 67 per cent agreed that AWR will lead to businesses deliberately employing workers for less than 12 weeks.
Kirkpatrick adds: The jobs market is at a crunch point. With over two million people still unemployed its vital that businesses dont discount temporary workers simply because they dont fully understand how AWR will affect them. Recruiters have been looking at the potential of the AWR for a number of years and are in an ideal position to help HR professionals and employers through the various nuances and exceptions in the regulations so they can still make the most of a temporary workforce. By speaking to recruitment professionals now, HR teams will be in a much stronger position to understand the full impact of the regulations when it hits in twelve months time so its vital that they start preparing for the changes as soon as possible.
The research found that only 15 per cent of HR professionals felt that they were very well prepared for the AWR and only 30 per cent were concerned about the impact that the AWR will have on their organisation. The biggest perceived impact of the regulations amongst the HR community is that there will be an increase in time spent on administration. Forty-four per cent of HR professionals questioned said this would be the biggest impact ahead of additional costs, increased need for legal advice and a greater need to recruit permanent staff.
Kirkpatrick concludes: Its vital that HR professionals see the AWR as more than just an administrative burden and instead recognise the risks of non-compliance. With just one year to go until implementation now is the time to take action.
Guidance notes critical as Government rejects last-minute changes to Agency Workers Regulations
Ministerial statement 19/10/10
A ministerial statement was issued by Edward Davey, Minister for Employment Relations, Consumer and Postal affairs Department for Business, Innovation and Skills on the Agency Workers Regulations (AWR) 2010.
The statement rejects any further revisions to the AWR on the grounds that any changes might have been subject to legal challenge because of the agreement brokered by the previous administration between the CBI and TUC.
Ann Swain, Chief Executive of the Association of Professional Staffing Companies (APSCo), comments:
It was always very unlikely that amendments to the Regulations could have been made at this stage. This is why APSCo has been concentrating on the guidance notes. The devil will be in the detail of those notes.
We have been asked by BIS to help draft the guidance notes. The guidance will help recruiters interpret how they should be implementing the Regulations. The wording of the guidance will have a massive bearing on how easy it is for recruiters to ensure they comply fully with the AWR.
Whilst it is disappointing that the Government has not looked at areas like the definition of pay, at least a lot of the uncertainty surrounding the Regulations has now been removed. We can now push on to make sure the Regulations are fully understood. The drafting of the guidance was completely stalled as we awaited todays announcement.
Its heartening that BIS is at least sympathetic to many of the concerns raised by APSCo and other stakeholders. The statement does at least give us some indication of where the Coalition stands on employment-related regulation.
There is still no need to panic just yet. Recruiters and end users wont be able to get their internal processes in order until the guidance notes have been published. Spending time at this stage worrying about compliance with the Regulations is premature.
CBI REACTS TO MINISTERIAL STATEMENT ON AGENCY WORKERS
The CBI today commented on a statement by Ed Davey, Minister for Employment Relations, that the Government would not be amending the agency workers regulations which come into force in October 2011.
John Cridland, CBI Deputy Director-General, said:
It is disappointing that the Government has decided not to re-open the temporary agency workers regulations.
While we agree that preserving the 12-week qualifying period is essential, changes proposed by employers would have cut red tape without changing the overall effect of the regulations. We regret that the government hasnt been able to reach agreement with the trade unions on this.
The priority now has to be timely, high-quality guidance, so that employers know where they stand well before the new rules come into force.
FCSA responds to latest BIS update on the Agency Workers Regulations
Responding to the Governments confirmation that the Agency Workers Regulations will go ahead, Stuart Davis, Chairman of FCSA said:
"We are encouraged that the Government has been making efforts to re-negotiate the CBI-TUC agreement. Nevertheless, we share their disappointment that an acceptable way forward could not be found. We hope that the future AWR guidance will reflect an understanding of the flexible workforce which for far too long has been put into one homogenous group where in fact it is a far more complex set of populations within the workforce ."
"Going forward we will push for the guidance to reflect the different categories of worker that exist, rather than ways of working. This means that those workers who are not potentially vulnerable can be excluded."