Time to tackle rogue employment agencies

Andy Newman, Labour PartyI was delighted to see the commitment from Ed Miliband that the next Labour government will tackle the unscrupulous activities of some recruitment agencies. There is a legitimate role for agencies providing temporary workers, to fill gaps where an employer genuinely has fluctuating work volumes, or where there are temporary tasks to be done.

But all too often employment agencies are used to seek to push down wages, and to use legal trickery to make it harder for workers to assert their workplace rights, whether it is the right to be treated with dignity by supervisors, or the right to a safe and healthy working environment.

I am old fashioned enough to value the relationship where most workers are employed by the company who name is over the door;and where employers feel a social responsibility to recruit from the area where that company is located. Take the example of Chippenham based firm, Wincanton, runs a distribution centre for Marks and Spencer in Swindon, and although all the goods there are M&S, shipped to M&S stores, sold to M&S customers to make profits for M&S shareholders, the staff at the waregouse don’t work for M&S. Most of them don’t even work for Wincanton. They are employed through one recruitment agency, called 24-7, and are actually employed by another agency, Tempay Ltd. When I first became involved seeking to help there workers, they didn’t even know who they actually worked for.

Tempay Ltd employ workers on a particular contract, known as the Swedish Derogation, which allows a legal loophole so that the agency workers are paid minimum wage, while colleagues employed by Wincanton earn £2 per hour more. What is more, their workers are only guaranteed 7 hours work per week.

Such low pay, and uncertain hours benefits no-one except unscrupulous employers, as it is the tax payer who tops up household incomes through benefits, and low wages impact on less spending in our local economy.

Labour will close the legal loophole called the Swedish derogation, and will also ban the practice of employment agencies recruiting workers abroad without advertising vacancies in the UK.

It is time we addressed the problem that our economy simply doesn’t live up to the simple bargain that hard work should be rewarded.

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