Employers Face Increased Liabilities

To protect agency workers from exploitation, a new directive to provide equal rights to agency workers is to be introduced in October 2011. Currently, a large percentage of permanent workers have more employment benefits and entitlements than their colleagues who are temporary and agency workers. These include working conditions and employment rights relating to working hours, pay, pay rise, holiday entitlement, training support and job assignments, amongst others.

The implication of this legislation is that companies that currently use temps and agency workers will be faced with increased responsibilities and possible rise in employment costs in the very near future. As the implementation day approaches, many companies have started to rethink their recruitment strategies.This controversial directive has in the past been opposed by some organizations claiming that this legislation will result in huge job losses, leaving the workers in a more vulnerable situation; as well as hindering flexibility in the industry. Companies relying heavily on temporary staff now have to ask ‘Is this really cost-effective? Is this really sustainable?' The workers also have to consider how their status will affect their current jobs and future prospects.

‘To bridge gaps in staffing, many companies are now resorting to the use of outsourcing companies and Interim Managers, depending on the period of cover required to do the work or the level of skills desired. These two options can save huge employment costs in National Insurance, pensions, healthcare, holidays, PAYE, training costs, severance pay, maternity pay, paternity pay as well as many other related expenses.

Contractors, self-employed and managed service arrangements will fall outside this legislation, and therefore the use of individuals within these categories will not result in any additional expense for the business generally speaking, as these would fall outside IR35.

For interim support, visit Interim Management Talent Bank at www.imtb.uk.com