Examination of Witnesses (Questions 200-219)
BRITISH CHAMBERS
OF COMMERCE
30 NOVEMBER 2004
Q200 Mr Clapham: But the people who are
on part-time working will fit in to ensure that you are able to
produce in the way in which you want to produce and would be on
similar terms and conditions to those who are employed full-time.
Mr Toye: They are in exactly the
same position. We were encouraged to do this by flexible working
and we do not see why that should be made regulatory. We are doing
it anyway and a lot of good employers are. That would be our argument.
We do not need the regulation in order to do this.
Q201 Mr Clapham: If we moved to a situation
where we did not need any regulation but we were able to achieve
an understanding of what was required—the norm, should we
say, of working—via negotiation, that would create a situation
of industrial democracy as, for example, people wrote about in
the 1960s, people like Allan Flanders. However, the very fact
that the industrial democracy (which academics thought was being
constructed in the 1960s and 1970s) was wiped away after Mrs Thatcher
came to power would tend to suggest that without regulation you
can never really have the kind of enduring stability. Would you
agree with that?
Miss Owens: A lot of these regulations
we are not opposed to per se. To use the example of Denmark,
one of the great strengths of the UK economy is its labour market
flexibility. To use the example of skills, yes we are improving
on skills and businesses invest a lot in skills, I think more
so than many other European Union Member States. However, skills
and transport for example are problem areas for our economy so
for labour market flexibility we need less regulation. It is what
enables businesses to increase to do business here and it is one
of the attractions of the UK economy, but increasingly we are
seeing it no longer as attractive perhaps as it once was.
Q202 Mr Clapham: Would you agree that
there was a multiplicity of combinations of flexible working?
For example, one takes the construction industry: if you had come
through London this morning at six o'clock you would have seen
vans picking up foreign workers to take them onto construction
sites. They will be working as peripheral workers. In other industries
we see, for example the service industry, it tends to be much
more structured but nevertheless has core and peripheral workers.
There is a need to be able to address different situations in
different industries and therefore a need to be able to ensure
that the kind of regulations that are applied are applied in a
way that is going to create a kind of harmony across the piece.
Would you agree that the regulations that are required tend to
be regulations that need to be applied across the piece? There
would be regulations that could be applied to the service industry
as well as the construction industry.
Miss Owens: Obviously a lot of
employment regulations do, yes.
Q203 Mr Clapham: So at the end of the
day your argument is not that we need no regulation, you are saying
that there needs to be less regulation. If there needs to be less
regulation which are the regulations which we need to ditch?
Miss Owens: I think it is more
the implementation regulation, the uncertainty of regulation,
the accumulative burden. For example, 1 October was Red Tape Day,
a number of regulations came in, businesses were telling us they
were unaware of the ones on unfair dismissal because the guidance
came out late in the summer. Initially they thought unfair dismissal
was a three-stage process but it turned out to be a far lengthier
process. It is the accumulative and administrative burden regulation
rather than regulations for example on part-time work or fixed-time
work. We would not be opposed to those regulations.
Q204 Mr Clapham: But you would agree
that all the health and safety regulations that are in situ
need to be retained and probably enhanced.
Miss Owens: Health and safety
of course is a different area. We can get back to you on that.
With a lot of health and safety a bar is continually raised and
that again is a problem for businesses. It is an uncertainty issue.
There is a certain level of regulation and then go back after
a year or two and it is increased again, and that is the problem.
Similarly with some of the maternity and parental leave regulations
we are seeing at the moment and the cost of the Minimum Wage.
Q205 Mr Evans: Am I right in understanding
that you are opposed to the Agency Workers Directive?
Miss Owens: In its current form.
Q206 Mr Evans: Why is that?
Mr Sidnick: The UK has the largest
agency market in the EU and the directive in its current form
has additional rights and responsibilities after a six week period
of employment of the agency workers and the majority of businesses
employ temporary agency workers for more than six weeks so it
would have a huge impact on the employment of a large section
of the workforce. In the UK it would be particularly damaging
because we use more temporary workers than any other EU country.
Q207 Mr Evans: What is going to be the
impact then?
Mr Sidnick: It is hard to assess.
In a survey that we did of 1,200 businesses 83% said it would
lead to a reduced hiring of temporary workers in the country.
So 83% of businesses who employ temporary agency workers said
they would have to employ less if the directive in its current
form came in, which is a strong figure. I have actually got the
figure here. The UK employs 27% of the entire EU temporary agency
workers so it would be particularly damaging to the UK.
Q208 Mr Evans: What would you say to
those who would say that coming up with these figures is similar
to the sort of scare stories about the minimum wage? In essence
this could come in, even in its current form, and it will not
actually have the impact that you suggest.
Mr Sidnick: I say that we have
to listen in advance to what businesses are saying. They run their
businesses on a day to day basis; they employ temporary workers
and they are saying overwhelmingly that this would lead to reduced
hiring and would lead to job losses. I think we need to listen
to the views of the businesses.
Q209 Mr Evans: Would you therefore agree
that agency workers ought to get more rights but perhaps not the
rights that are contained in the current directive?
Mr Sidnick: That they should not
get the rights in the current directive after a six week period.
Q210 Mr Evans: What period should it
be then?
Mr Sidnick: We are currently calling
for a 12 month period with other business organisations. We think
that would be a satisfactory period where, if you are working
as a temporary agency worker for that long a period then you should
have the same rights. That would be a safe period.
Q211 Mr Evans: When your firms employ
agency workers what is the average they employ them for? Is it
six months?
Mr Sidnick: It is a period of
between three to six months.
Q212 Mr Evans: How many people would
be covered by the 12 month period?
Mr Sidnick: The 12 months would
cover a large majority; the vast majority.
Mr Toye: We use them for recruitment.
In other words, we do not take people on permanently, we take
them on as a temporary worker to see how they perform over two
or three months and then if they are successful we recruit them.
Q213 Mr Evans: Can you not tell after
five weeks?
Mr Toye: We have thought about
this and you do need a bit longer than that because people have
not learned enough about the job within a five week period.
Q214 Mr Evans: You can tell if they are
useless by five weeks, though, can you not?
Mr Toye: Yes. It is the borderline
cases where you think somebody is going to learn a bit more and
then actually take the job. Three to six months is a reasonable
period. We recently took somebody on who we had had on temporary
employment for three to four months.
Q215 Mr Evans: So you would not mind
six months yourself, speaking for yourself.
Mr Toye: I would not mind six
months, no; that is a reasonable length of time.
Q216 Mr Evans: Speaking as an employer
again, if it comes in at six weeks what are you going to do?
Mr Toye: We would probably make
hard choices. Our recruitment would not be so easy.
Q217 Mr Evans: People you might otherwise
have kept on you are just going to get rid of after six weeks.
Mr Toye: If there is any doubt,
yes.
Q218 Chairman: What is the position at
the moment as far as the ability to dismiss people? As I understand
it you can do it without reference to a tribunal in the first
12 months. Is that the case?
Miss Owens: Unfair dismissal rights
come in at 12 months.
Q219 Chairman: Is it cheaper to employ
agency staff or not?
Mr Toye: It is more expensive
actually because you are paying an agency commission. It is actually
beneficial not to generally.
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