He promised that the next Labour Government will:
- Close loopholes which allow employment agencies to undercut wages of permanent staff
- Ban employment agencies recruiting only from abroad
- Force rogue agencies illegally exploiting their workers to clean up their act through measures such as the introduction of a licensing system.
They also signalled their intention to tackle the 'zero-hours' contracts which have been associated with vulnerable workers. He described it a 'mission' to change the 'insecurity, exploitation and unfairness' that some people face at work.
Speaking in London, Mr Miliband said: “We will not tolerate a zero-zero economy where hundreds of thousands are kept on zero hour contracts while a tiny privileged minority pay zero tax.
“And nor will we tolerate a world of work that is becoming more brutal because of the way some cowboy employment agencies have been allowed to operate. They are undermining dignity at work, driving down standards and creating greater insecurity for families.
“There has been a huge increase in temporary agency work in recent years. Many employment agencies play their part in supporting businesses, as well as workers, who want flexibility.But there is now overwhelming evidence that some are operating in the shadows of our economy and on the margins of law, damaging the basic fabric of British life that hard work should be properly paid.
“Even the industry itself is expressing concern that the number of rogue agencies have increased in recent years. They are breaking the law on the minimum wage, failing to pay their taxes, and exploiting workers to undercut the wages of permanent staff,
“These rogue agencies need to know their time is up and we will act."
The Labour party intends to begin consultations now, before the next election, on the different ways this can happen such as through a licensing system to ensure that agencies are complying with basic standards.
The fear of contractors and freelancers who operate through agencies will be that they are swept up in legitimate proposals to protect vulnerable workers, while some agencies will see this as cheap political 'point scoring'.
Silly
Agency trade body, the Recruitment and Employment Confederation (REC), immediately hit back dismissing the criticism of the work of UK recruitment agencies as 'silly' and describing it as 'random business bashing'.
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“A quarter of people in Britain have taken jobs as agency workers at some point in their careers. It is a mainstream part of the economy and our flexible labour market which has seen us do so much better than our European neighbours. Any measures undertaken by the next government must take full consideration as to the impact changes might have on the recovery.
“The Labour Party is very clear that they must support those people who want and choose to work flexibly. A knee-jerk policy reaction that stops people being able to get employment and earn money as agency workers would be a huge mistake.
“We represent over 80 per cent of the UK’s recruitment industry by value, and agencies have to abide by the law, our code of professional practice and pass our compliance test in order to call themselves an REC member. The language Miliband has used today to smear our members is an insult to the 90,000 hard-working people employed in the UK’s recruitment industry whose mission every day is to find suitable jobs for people who want to work and make a living.
“We are looking for a mature and consultative relationship with the Labour party and its current leadership and are really disappointed with Mr Miliband’s remarks today. As the professional body for the recruitment industry we are keen to work with politicians from all parties to ensure the labour market as a whole and the individuals within it continue to prosper.”
Swedish derogation
The so-called 'Swedish derogation' came into existence alongside the Agency Workers Directive as a controversial 'work-around'. The Labour Party has now called this a 'legal loophole' which allows agency workers to be paid a lower rate than permanent employees, if they are paid between assignments.
They say that there is further exploitation as agency workers are sometimes paid the lower rate even though they work regular shifts. They add that is also anecdotal evidence that they may be offered work in a remote location or unsuited to their abilities, and then denied the full rate of pay on the basis that they have declined a 'suitable' offer of work.
However, REC's Kevin Green took issue with claims that it is a 'loophole'. He said: “Pay between assignments – or Swedish Derogation - was agreed under the previous Labour government with the support of the CBI and the TUC. It is not a loophole, it is the law. As with any new legislation, any sudden changes to these regulations - which took years to bed in - could have a negative impact on the jobs market."
Overseas
The Labour Party said that employment agencies, some of whom recruit exclusively from abroad, are a driver of low skilled migrationand that ONS figures show that the proportion of low skilled jobs in the economy filled by workers from outside the UK has doubled over the last decade.
Mr Green added: “I am bemused as to why politicians believe it is necessary to ‘crackdown’ on agencies that hire exclusively from overseas. British agencies have to list all vacancies in Britain and in English. That is already the law. Advertising exclusively overseas is already prohibited under the Equality Act and the current Government is about to introduce another new rule to the Conduct Regulations that explicitly prohibits this activity.”
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Susie Hughes © Shout99 2014
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