Crystal Umbrella

The Agency Workers Regulations are due to be implemented in the UK on 1^st October 2011. This EU directive has been controversial and contentious in the contracting sector as contractors fear that these regulations could cost them work opportunities. The aim of the directive is to protect agency workers at the lower paid end of the spectrum. However, even after extensive consultation many high earning contractors, including umbrella contractors, have been caught by the legislation.

However, fresh discussions are afoot regarding the regulations which could be of benefit to  technical and engineering contractors. The Recruitment and Employment Confederation is set to discuss the impact of the regulations with its members and fellow recruitment organisations in the next few weeks. The leading recruitment body in the UK will also be joined by Semta who are the skills council for the manufacturing and engineering sector. They will be briefing the assembled group on building a “workforce for tomorrow”.

Chair of REC’s engineering and technical arm Philip Higgins, stated: We always aim to address the key issues faced by our members at our briefings. This briefing will provide that, by focussing on both day to day business and the long term structure of the industry.”

He concluded: “From a range of topics members can gain food for thought and some practical steps and advice for their companies.”

In an interview with Recruiter, Keith Butler from the IT recruiters NES IT, has said that there has been a decline in IT contractor demand across the public sector.

He said: “The focus is on cost-cutting, therefore demand for contractors is lower than is has been in the past. With clients emphasising cost, there’s increased pressure on rates and agency margins and more justification is required (often at a more senior level) for each appointment or contract extension. However, this is being balanced by an increase in hiring activity (contract and permanent) in the private sector, particularly banking / finance and services.”

In fact, the latest research conducted by the Recruitment and Employment Confederation shows that permanent IT and computing staff are currently the most sought after workers for UK agencies and recruiters.

The REC research actually showed that IT staff are more likely to be offered permanent positions than workers from seven other sectors. However, contrary to the experience of NES IT, the REC data did show an increase in IT contracts being awarded also despite the demand for non-permanent executives growing at the slowest rate. Overall this shows a return in confidence for recruiting in this sector especially as this is the third month in a row that they have reported a growth in IT openings.

The research also found that the most difficult IT workers for recruiters to source are those skilled in software sales, analysis and Share Point.

Yesterday, as the final regulations for the Agency Workers Directive were laid before Parliament, there was confirmation that its implementation would be delayed until October next year. This move has been welcomed by agencies and contractors alike.

As reported in The Recruiter, chief executive of the Recruitment and Employment Confederation, Kevin Green, said of this news: “Professional recruiters will bear the brunt of making these complex regulations work on the ground and we are pleased that some of the recruitment industry’s key concerns have been taken on board. In particular, we welcome the delayed implementation date and the decision not to impose potentially damaging restrictions on the fees charged by agencies where a temporary worker is taken on permanently by an employer.”

In conclusion, however, Mr Green added his concerns about the legislation: “However, there are real concerns that these EU regulations are ill-adapted to the UK labour market and could limit job opportunities at a time when flexible working options are providing a crucial route into employment. The priority now is to ensure that effective guidance is developed for employers and recruitment agencies.”

While the later implementation date is good news, there are still concerns and apprehension aplenty regarding this directive. Speaking for manufacturers’ organisation EEF, their head of employment policy David Yeandle confirmed their stance with The Recruiter, stating: “manufacturers will be pleased the government has confirmed that this legislation will come into force in October 2011 and that it has resisted pressure for its earlier implementation. However, we remain concerned about the costs and administrative burdens that this new legislation will impose on employers and, in particular, about how the decision to include some bonus payments in the definition of pay that will be used for equal treatment.”

Mr Yeandle concluded: “It will now be important for the government to publish clear and practical guidance for employers on these regulations well before their implementation in October 2011.”

As the latest Recruitment and Employment Confederation (REC) Jobs Outlook results are released, the organisation has praised contractors and freelance workers, stating that they provide “crucial services” to cover seasonal demand.

Chief executive of REC, Kevin Green stated: “Whilst many of us have downed tools, thousand of key workers and recruitment professionals are hard at work. Temporary, contract and locum staff as well as interim managers provide crucial front line services and keep Britain working over Christmas. At the same time, recruitment professionals play a pivotal role in responding quickly and efficiently to the demand for often highly-skilled staff in sectors such as healthcare, transport, care, logistics and technology.”

The December Jobs Outlook showed that 22% of employers believe that business is improving. This is a staggering 21% increase since September.

Roger Tweedy, REC’s director of research said: “”At last there is evidence that life is returning to the UK’s labour market. After several months of uncertainty it seems that firms are becoming more confident about their future hiring intentions. Although if previous recessions are anything to go by we would expect unemployment to continue to rise even after the economy returns to growth, this report shows positive signs that unemployment will not be as high as people at the beginning of the year predicted.”

He concluded: “Whilst the labour market is still very fragile, the feedback from recruiters on the frontline of the labour market suggests that it is becoming easier to place jobseekers into work. As the labour market becomes more fluid once more this in turn will create more vacancies”.