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Agency Workers Directive could see UK labour costs rise by 20%

Published on Dec 5, 2007 |

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Our partners at Contractor Calculator, the largest independent website specialising in the contacting industry, has calculated that labour costs for UK business will rise from 10-20 per cent if the Agency Workers Directive is passed today.

Industry expert, Dave Chaplin, has broken down the costs as follows:

For a contractor who is paid 10 pounds per hour, and who works 47.2 weeks per year, the additional cost of holiday alone adds 10% to what the employer paid previously.

If the worker is sick for a week, the total cost goes to a 13% increase per year to the employer (£2,370).

This makes the extra cost to UK business based on 1.3 million workers averaging £10 per hour: £3,081,281,385 (3 billion).

A dedicated Agency Workers Directive Impact Calculator for cost breakdowns under the directive has been set up here.