EU kicks Temp directive into the long grass

Following intensive lobbying by the Confederation of British Industry - CBI, the EU has failed to reach agreement on the Temporary Agency Workers Directive - TAWD.

The directive was aimed at providing temps with the same pay and conditions as their permanent counterparts.

Digby Jones of the CBI had argued prior to the meeting that:-

"It is unnecessary and wrong to drag firms into negotiations over pay and conditions when hiring people from an agency for short periods. That should remain a matter for the agency and worker. Saying the law would kick in after six weeks is a totally inadequate response that only pays lip service to our concerns.

"Without improvements, taking on temps will be less attractive and that will do irreparable damage, not just to business but to employees as well. The UK has a strong record on creating jobs, particularly for those on the fringes of the labour market. This success story could be seriously undermined."

The EU council of Ministers met yesterday - 3rd June 2003, to agree the directive, but could not reach agreement on the qualifying period. The directive called for 6 weeks, but the UK, Germany, Denmark and Ireland held firm to the CBI line that this should be extended to 12 months.

The TUC, which had mounted a last ditch lobbying effort, slammed the Government over their actions:

"The government has sided with business interests to 'scupper' the prospect of agency workers getting equal pay and basic rights in the foreseeable future," said TUC general secretary Brendan Barber.

"It is bad for business and unjust for agency workers to be denied protection from sub-standard treatment."

Anna Diamantopoulou, the EU commissioner responsible for the Directive, also was critical of the council's indecision, saying:-

"There is no objective reason why the Council could not have reached political agreement on this directive today. I am deeply disappointed, particularly given the long, hard hours which the Presidency and Member States have devoted to clearing the way for agreement."

What happens next?

Talking to informed sources it is believed that the Italians who hold the next Presidency will not want to touch this issue and it is most likely therefore to reappear under the Irish Presidency in around a year's time. There is an outside chance that a special meeting might be called within the next few months, but this is considered unlikely.

What does it mean for freelancers?

It was considered that the Directive in its current form would not have affected Ltd company/self employed freelancers, but this was more down to ignorance than intent. The fear was that the rules were so widely written that they could have affected the UK freelancer.

If the directive had come in it was argued that it would have accelerated the move offshore as clients looked to ship more of their "temp" requirements into areas of the world with lower regulation.

It will be interesting to see what happens to the UK agency legislation which had been "parked" as the EU considered the TAWD.

Finally this development may be seen as a watershed for the power of the Social Affairs Directorate which has been responsible for much of the Social Chapter type legislation within the EU. The EU appears to be waking up to the fact that the EU is part of an interdependent "Global Economy". If this proves to be the case, it will be good news for freelancers as the trade focused Departments within the EU attempt to roll back the barriers to free trade of services within Europe.