Agency Workers Regulations - Swedish Derogation

The contracting industry has reacted to a newspaper report that David Cameron may seek to review the implementation of the Agency Workers Regulations.

According to an article in the Telegraph today, the PM has secretly sought legal advice on how the impact of the AWR can be moderated, either by watering down the current provisions, or by refusing to implement the rules at all.

Clearly, any proposed changes to the AWR so close to its planned 1st October implementation date would cause a great deal of uncertainty for the entire contracting community, even though most business organisations would we pleased if part, or all of the AWR provisions were removed.

Changes welcomes, but need to avoid unnecessary confusion

Contractors' organisation, the PCG, believes that any changes that would make the AWR clearer and simpler would benefit the UK's freelance workforce, and would send a strong message that these workers are not the intended targets of this legislation. However, they also question whether it is realistic to expect changes to be made so late in the day:

PCG's MD, John Brazier, commented:

"Though freelancers who genuinely supply their services as businesses to other companies are exempt from the AWR, any moves to make this as clear as possible are to be welcomed. Freelancers are the UK's smallest businesses, and the £21bn their flexibility adds to the economy should never be hindered by unnecessary legislation.

"However, it is not clear if any change to these laws is feasible this late in the day, and we will be seeking further information on this from the Government. It is vital that unnecessary confusion is avoided at a crucial time for agencies and freelance workers."

Initial AWR review period could be brought forward by 12 months

The Recruitment & Employment Confederation (REC) and PCG have both welcomed the possibility that the AWR could be reviewed after just one year, instead of the two year settling in period which is currently planned:

Kevin Green, the REC's Chief Executive said:

"If the Government was to go head to head with the EU in simply refusing to introduce the new laws, there would be legitimate questions as to why this option was not pursued before as agencies have already invested substantial time and money in preparing for implementation on October 1st.

"In most sectors, the impact will be limited and recruiters are already working with their clients to make new equal treatment measures work. However, any measures to streamline the way that the regulations are applied would of course be welcomed.

"One realistic way forward would be for the Government to agree on an early 'one-year' review of the Regulations. This is something the REC as called for in recent discussions with Ministers."

Concern for service providers too

Stuart Davis, Chairman of the Freelancer and Contractor Services Association, welcomes the principle of reviewing the AWR, but is concerned that his member companies have spent a great deal of time and money preparing for the implementation as it currently stands:

"The FCSA welcomes the Prime Minister's initiative in commissioning legal advice on the AWR, but would counsel against them making any detailed changes at this late stage. Many of our members have spent time and resource setting up new systems to take account of the AWR and to make a change at this late stage would result in major chaos and inconvenience for thousand of freelancers and contractors.

"A simple but effective move would be to change the 12 weeks qualifying period to the maximum allowed under the legislation which is 6 months. This would mean a significant number of temporary workers would not fall within the regulations, thus reducing the burden on business."