The European Council has adopted a new EU directive on 'transparent and predictable' working conditions, relating to (amongst other things) the rights of agency workers and gig workers. The directive must now be implemented by EU Member States over the next year or so.
While the nature and timing of Brexit will determine whether the directive is required to be implemented in the UK as a matter of law, the UK government seems likely to implement this or something very similar given the various announcements about protecting vulnerable workers as part of the response to the Taylor Review, and the stated intention that Brexit should not lead to UK worker rights being relatively worse than elsewhere.
Much of the directive is predictable and not too ground-breaking, (such as being clear and transparent with workers about the terms under which they are engaged), and in some cases it is already reflected in UK law.
But there are some general trends in the directive, together with various other recent initiatives, which point to quite material changes in the way that staffing companies (and online staffing platforms) will need to operate:
- In certain situations there will be a rebuttable presumption of employment rights. This means that it will become much harder to defend employment status cases, and claims by gig workers for national minimum wage/holiday pay/notice pay etc.
- This directive (or other UK legislation introduced off the back of the Taylor Review) is likely to throw a spotlight on any liability to pay workers accrued unused holiday pay at the end of an assignment. At present, it is not uncommon on short term assignments for workers to disappear, with their unclaimed holiday pay significantly adding to the net profits of some staffing companies.
- There will be significant limits on the ability to prevent workers taking up parallel engagements with other staffing companies/platforms/end users.
- The ability to avoid certain employment rights by placing workers on probation will be reduced. The directive limits the probationary period to a maximum of 6 months, with longer periods allowed only in exceptional cases.
- There will be a right to request, after at least six months service with the same employer, employment with more predictable and secure working conditions. Might this prevent staffing companies being able to charge temp-to-perm fees beyond the current limits in the Conduct Regulations?
- There will be a right to receive training cost-free, when such training is required by an agreement with a union or national legislation. This may be a major issue in due course if training obligations on employers are increased in response to productivity issues, and government concerns about workers requiring new skills in the face of automation and other technology impacting on so many aspects of their work.
The political landscape in the UK remains unclear. However, staffing companies should start preparing now for the implementation of the directive's requirements, particularly against the backdrop of the UK proposals arising from the government's response to the Taylor Review. The EU proposals reflect the general trends we are already seeing, which all involved in the use of contingent workers in the UK and across Europe must plan for.