Short-term contractors could get a raw deal, warns TUC

Short-term contractors in the UK could miss out on equal rights to pay and pensions if the Government waters down the implementation of the EU Fixed-Term Contracts Directive, according to the Trades Union Congress (TUC).

Universal rights for short term contractors

Holiday

Every worker is entitled to 20 days holiday each year from their employer, as long as they have worked for a minimum of 13 weeks.

If the work is carried out through an agency, the agency is the employer, not the company who you work for on a day-to-day basis. Claims should be made through them.

A recent European Court of Justice ruling will improve holiday rights for some freelance workers.

Maternity rights

New rules mean that women who are temporary workers can get maternity pay, but they are not entitled to maternity leave.

This is because there is no obligation for the company they are working for under a short-term contract to give them 18 weeks statutory leave and keep the job open for them.

Paternity leave

Some companies provide paid paternity leave schemes, but there is no obligation for clients to do so.

However, if a contractor has been working for a client for at least one year, parents have the right to take up to 13 weeks' unpaid leave per child up until its fifth birthday.

Leave can only be taken in one-week blocks, with no more than four weeks off in any one year for any one child. From 2003, employed fathers will have the right to two weeks' paid paternity leave at a flat rate of £100 a week.

Unfair dismissal

A short-term contractor can claim unfair dismissal if they have worked continuously for the same company for one year.

Pay, pensions and sick pay

Short-term contractors are not entitled to equal pay or pensions as permanent staff.

The TUC wants the Government to include these benefits within a European Union directive, the Fixed-term Contracts Directive, which it must introduce by next year.

Everyone is entitled to Statutory Sick Pay (SSP) if they have been contributing towards National Insurance and have been sick for at least four days in a row including weekends and bank holidays.

Although the Government plans to comply with the 1999 Directive by next July, the TUC is concerned that equal treatment on pay and pensions may be excluded since disagreements have developed over the Directive's interpretation.

Prior to calling on the Government to include temporary workers in the Directive, the TUC conducted a survey of almost 200 unionised workplaces entitled 'Permanent Rights for Temporary Workers'. The survey found:

50 per cent pay temporary workers on different pay rates compared with permanent workers (47 per cent get less and just three per cent get more)

70 per cent do not offer the same access to occupational pension schemes

25 per cent do not give access to contractual sick leave to temporary workers

14 per cent do not give holiday pay to temporary workers

The survey also revealed a two tier temporary workforce emerging: those in high-skilled, high-tech sectors who are able to 'play the field' and a growing band of those at the lower end of the labour market who are often paid less, get worse terms and conditions and are worried about their job security.

There are 1.7 million people in the UK on temporary contracts, 'casuals' or agency workers, seven per cent of the country's total workforce.

The TUC found that contracting is growing among professionals, managers and technically qualified staff. Some of the biggest growth sectors for short-term contracting are in banking and finance, hotels and restaurants, further and higher education, transport and tourism.

John Monks, TUC General Secretary, said: "Some high-skilled workers positively choose to do temporary work, welcoming the autonomy and flexibility provided by well paid short-term challenges. For companies to get commitment from these workers, they must in turn show their commitment to providing them with the necessary rights. Constant worries about being laid off, lack of sick pay and access to pensions means a UK workforce that is treated mean and anything but keen. That can only be bad for business."

Richard Darlington, TUC spokesman, clarified who will be affected by the Fixed-Term Contracts Directive. He said, "Contractors who are operating under Limited companies and are self-employed would not be covered by any interpretation of the Fixed Term Working Directive. However, knowledge-based contractors who are not self-employed are the types of people at the top end of the two tier temporary workforce, which we describe. The Government and business think such people should be excluded from equal pay and pensions rights while we are trying to change their minds."

The Recruitment and Employment Confederation (REC) is opposed to including agency workers in the Directive.

Tim Nicholson, REC's Chief Executive, said: "It is not in the interests of agencies for agency workers to be exploited or for them to enjoy less protection than other workers but there must be variation in the way that protective measures are implemented."

The biggest fear is that including agency workers in the Directive could deter employers from taking on contract staff.

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Richard Powell, UKTECH