The temporary agency work sector across Europe Denis Pennel - - - PowerPoint PPT Presentation

The temporary agency work sector across Europe

Denis Pennel - Eurociett Managing Director

Eurociett in a nutshell

• Eurociett represents 36,000 companies (57,000 branches), employ

250,000 internal staff and more than 3 million agency workers on a daily average (FTEs) and around 10 million a yearly basis (headcounts)

• Is the only authoritative voice representing the interests of the

reputable agency work businesses in Europe:

– Accounts for more than 90% of the total sales revenues of the industry in Europe Europe – Recognised by the European Institutions as well as by key European stakeholders (e.g. ETUC, UNI-Europa, BusinessEurope)

• Eurociett is the only association representing agency work:

– At large: brings together 30 national federations – In its diversity: uniting 7 of the largest multinational staffing companies as well as tens of thousands of SMEs

• Eurociett Members consist of private companies operating in the

following HR activities: temporary agency work, recruitment, interim management, executive search, outplacement, training

Eurociett National Federation members

France UK REC Ireland NRF Denmark Dansk Erhverv Finland HPL Switzerland SwissStaffing Netherlands ABU Belgium FEDERGON Norway NHO Service Sweden ALMEGA Slovakia APAS Turkey OIBD Slovenia ZAZ France PRISME Czech Rep APPS Germany BZA Greece ENEPASE Italy ASSOLAVORO Luxembourg ULEDI ABU Austria VZA Poland HR Forum Portugal APESPE Spain AGETT & AETT Hungary SZTMSZ Macedonia NFTWA Estonia EFPRA Bulgaria BG Staffing Romania ARAMT Latvia LASA Lithuania LIIA

Corporate Members

Eurociett long term objectives

Shaping appropriate regulation for the TAW industry

• Implementation of the Agency Work Directive
• Discussion on the Posting of Workers Directive
• Promoting quality standards

Striving for a better recognition of its contribution to a well- functioning labour market functioning labour market

• EU 2020 Strategy
• Supporting economic recovery
• Cooperation between public & private employment services

Developing constructive relationships with European trade unions to advance understanding of the TAW industry

• Eurociett recognised as an official EU social partner for the TAW

sector since 2000

Where does the Temporary Agency Work industry stand now in terms of development now in terms of development in Europe?

UK 31% Belgium 4% Spain 3% Switzerland 3% Rest of Europe 10%

European TAW market split per country

% of total revenues Europe

France 19% Germany 13% Netherlands 11% Italy 6%

EU average of temporary contracts 12% EU average

• f TAW

1.5%

France Finland Sweden Slovenia Netherlands Portugal Spain Poland

TAW penetration limited compared to all temporary contracts (2009)

28 27 26 25 24 23 22 21 20 19 18 17 16 15 14 13 12 11 10 9 8 7 6 5 4 3 2 1 Romania Slovakia UK Norway Belgium Hungary Czech Republic Denmark Austria Greece Italy Switzerland Germany France

Percentage of working population

29 AW penetration rate in 2009 (%) Share of employees with temporary contracts in 2009 (%)

100% 80 60 Public Other

Tertiary

Importance of sectors differs between countries

40 20 Agriculture Manufacturing Construction Services Administration PO FR AU CH DE1 IT BE ES1 UK SE NO NL

Primary Secondary

AW Penetration Rate 2009: 2.5% 0.8% 1% 3.7% 0.4% 1.6% 0.7% 1.6% 1.3% 1.4% 1.8% 0.5%

Share of sector (2009)

The diversity of agency workers’ profile should be recognised

Workers reentering Workers First time Students

(make money to fund studies and/or vacations)

Workers reentering the labour market (work as temps after period of

unemployment

/maternity leave) Workers looking for a permanent job

(Second best choice but see AW a stepping stone)

First time entrants (enter the labour market and gain first work experience)

Flex Professionals

(not looking for a permanent contract) Senior workers (remain employed to get additional incomes)

Number of PrEAs in CEE

Number of temporary agency workers in CEE

Age split of agency workers in CEE

The implementation of the AWD: Towards an harmonisation of regulation at EU level?

The need to recognise the specificity of the triangular work relationship

• Agency Work is based on a triangular relationship

between an agency, a worker and a user company (not related to fixed-term contracts, subcontracting or self employment)

15

Supervision

• f work

Employment contract Commercial contract

Most common conditions to the use of TAW in EU

Equal Treatment Main restrictions

• n TAW use

Main obligations for TWAs

TAW regulation

Restriction

• n use of

AW in particular sectors (constructio n, public services..) Limitation of time spent in same assignment and renewals Limited legally accepted reason for using AW Equal pay (same salary for agency workers than permanent workers holding the same job in user company) Sectors Duration/ renewals Reasons of use Administrative & financial Employment contract Licensing/cert ification systems +

• bligation to

report statistics to gvts Only limited types of contracts that can be offered to agency workers

The Agency Work Directive A balanced solution has been found

Lifting of unjustified restrictions (Article 4) Common minimum standards for agency workers (Article 5)

Principles of equal Obligation to review restrictions

• nce within three

Possibility to derogate from the principle at national level (3 derogation clauses) Principles of equal treatment apply from day 1 Restrictions are

• nly justified on

limited grounds. Unjustified restrictions must be lifted

• nce within three

years after entry into force of the Directive

Preamble: “TAW meets not only undertakings’ needs for flexibility but also the need of employees to reconcile their working and private lives. It thus contributes to job creation and to participation and integration in the labour market”

AWD: What kind of restrictions are to be reviewed (Article 4)

Limited length of assignment Belgium, Czech Republic, Finland, France, Greece, Luxembourg, Poland, Portugal, Romania, Slovenia, Spain, Sweden Sectoral bans Belgium (removal, public sector) France (public sector, work doctors) Germany (construction) Luxembourg (public sector) Netherlands (sea shipping) Spain (construction, public sector) Limited reasons for use Belgium, Finland, France, Italy, Luxembourg, Netherlands, Poland, Portugal Limitation on TAW contract renewals France, Italy, Luxembourg, Romania, Sweden Waiting period France, Luxembourg, Hungary Compulsory exclusivity of TAW services Greece, Luxembourg, Portugal, Spain Limitations on number of temporary agency workers Austria, Italy, Sweden

AWD: How to apply the Equal Treatment principle (Article 5)

• Equal treatment covers “basic working and employment

conditions” defined as:

– Pay (to be defined at national level) – The duration of working time, overtime, breaks, rest periods, night work, holidays and public holidays

• Directive allows for three forms of derogations:

– For open-ended contracts – For open-ended contracts – Through collective labour agreements – By agreement of social partners for countries that do not have a system of universally applicable CLAs

• Eurociett is calling national social partners to discuss benefits
• f some derogation to the Equal Treatment principle for a

limited period of time (e.g. to help long term unemployed to re- enter the labour market)

Article 5: Equal Pay/Treatment as currently in place in EU

Countries with Equal Treatment regulation

• Austria
• Belgium
• Czech Republic
• Denmark
• Finland
• France

Countries with no Equal Treatment provision

• Ireland
• UK (draft law establishes

a 12 week derogation) Countries with no specific regulation on Agency Work

• Bulgaria
• Cyprus
• Estonia
• Lithuania
• Latvia
• Malta
• France
• Germany
• Greece
• Hungary
• Italy
• Luxembourg
• Netherlands
• Poland
• Portugal
• Romania
• Slovakia
• Slovenia
• Spain
• Sweden
• Malta

Regulation: The timeline evolution of agency work acceptance

Illegality grey zone Legal recognition Social tolerance Normative acceptance Societal acceptance Full recognition

• Hostility and

rejection of this new form

• Containment
• f an

unpopular

• AW

accepted by trade unions,

• Useful tool

for labor market

• AW as an

acceptable work

• AW as a

desirable choice of

Social development

this new form

• f work

relationship unpopular industry, as a last resort HR provider trade unions, if properly regulated market policies work alternative choice of work No regulation Coercitive regulation CLAs in addition to existing law Lifting restrictions Social partners to define regulation Appropriate regulation

Regulatory development

To what extend TAW can help to improve functioning of the labour markets in East & South labour markets in East & South East Europe?

TAW ensures job creation

Almost two thirds of user organizations would not have created jobs if they had no access to AW Alternatives to AW

54%

% of responses (total = 101)

80 100 No job creation (62%) No substitution

Conclusions

• 74% of companies

do not consider hiring permanent workers an alternative to AW

Source: User organization survey, BCG analysis

Not do the work 12% 60 20 Other external flexibility solution 100% 40 Internal flexibility solution 26% Hire permanent workers Total 8% (62%) substitution (74%)

alternative to AW

• In 62% of the cases

there would be no job creation as companies chose internal flexibility or not to do the work

TAW penetration (% of workforce)

5

4 3 United Kingdom Netherlands

TAW contributes to the fight against undeclared work

Countries with high AW have lower levels of illegal economic activity

R2 = 0.41

2 1

Illegal economy (% of GDP)1

25 20 15 10 5 U.S.A. Switzerland Sweden Spain Portugal Norway Japan Italy Ireland Greece Germany France Finland Denmark Belgium Austria

• 1. Calculated using the currency demand approach and the MIMIC method; for more information see "The Influence of the economic crisis on the underground economy

Germany and the other OECD-countries in 2010: a (further) increase" by Dr. Friedrich Schneider Note: 2008 figures used in order to remove impact of crisis Source: Prof. Dr. Friedrich Schneider, Department of Economics, Johannes Kepler University of Linz, 2010

TAW helped reduce unemployment & illegal economy in Italy

Illegal economy (% of GDP) Unemployment rate (%)

30 25

AW penetration rate (%)

1.2 1.0 0.8

Legal recognition

• f AW in Italy

10 5 2009 2008 2007 2006 2004 2003 2002 2001 2000 1999 1998 1997 1996 0.6 0.4 0.2 0.0 2005

Illegal economy TAW penetration rate Unemployment rate

Unemployment rate started to decline right after introduction of agency work

Regulatory changes in favor of AW

• f AW in Italy

Source: OECD, Ciett national reports, GiGroup

TAW facilitates transitions through out a lifetime career path

30 40 50

Working hours

Job 1 Job 2 Job 3 Job 4 Job 5

Profession 1 (salaried) Profession 3 (self-employed)

training

Profession 2 (salaried)

10 20

18 19 20 23 27 29 33 38 43 46 49 52 57 59 63 70

Job 6

Age

= Transition

Unemploy ment

What can be learned from social What can be learned from social dialogue in Western Europe?

Social dialogue: What are the achievements so far?

• National level

– In countries where TAW is well established, existence of robust national sector-level collective bargaining (e.g. BE, FR, IT, ES, NL, DE, AT, Nordic Countries) – Lead to joint actions to improve working conditions and benefits of agency workers:

• e.g. pension funds, complimentary health insurance, training funds
• EU level (Eurociett/UNI Europa)
• EU level (Eurociett/UNI Europa)

– Formal EU sectoral social dialogue committee established in 2000 – Main achievements:

• Joint-declarations on Agency Work Directive (2001 and 2008), Flexicurity

(2006) and Vocational Training (2009)

• Promotion of national sectoral social dialogue

– Roundtables organised in Poland (2006), Hungary (2007), Bulgaria (2009) to bring together national sectoral social partners

• Research to improve factual knowledge of TAW:

– Regulation of TAW in the EU 27 (2006 & 2009) – Joint project on vocational training provided to temps – Joint project on cross border activities within TAW at EU level

– Promotion of ILO Convention 181 on PrEAs

A sector committed to social dialogue

Countries/ EUROPE Cross- sectoral AW sector AW company User companies

Austria

• Belgium
• Denmark
• Finland
• France
• Germany
• Ireland
• Ireland
• Italy
• Luxembourg
• Macedonia
• Netherlands
• Norway
• Poland
• Portugal
• Spain
• Sweden
• Switzerland
• UK

(

• )
• Source: Eurofound & Ciett

NB: in the UK, , cross-sectoral level refers to a single agreement between CBI and TUC rather than to collective bargaining as such.

How social partners can shape regulation TAW

The “phase model” in the Dutch CLA

Phase A: Specific agency work contract(s) for the duration of the assignment, maximum duration of 78 weeks Phase B: Fixed-term contract(s): maximum of 8 contracts and maximum duration

• f contract(s) 2 years

Phase C: Indefinite contract

Labour contract concluded between a 30 between a specific agency worker and a specific agency (= employer)

Equal pay is applied after 26 weeks in one assignment No maximum length of assignment (since 1998 labour market reform)

Approximately 72% Approximately 28%

Bipartite bodies in Europe for TAW

Austria Belgium Training Pensions Social benefits Health & Safety Compliance France Italy Luxembourg Netherlands Spain Compliance

Social partners’ bipartite bodies in the Netherlands for the Agency Work industry

• Budget = € 2.6 million
• Mission= Professionalise

vocational training and career development for employees & improve mobility of agency workers

• Nbr agency workers concerned

= 23,120 in 2010

Training (STOOF)

• Budget = € 5 million (0.2% from

wages)

• Mission: Providing additional benefits

to agency workers regarding access to housing, credit, childcare, holidays...

• Nbr agency workers concerned =

168,271 (active) and 466,039 (inactive) in 2010

Social Fund (SFU)

• Budget = €2,1 million
• Mission = to stimulate

compliance with existing CLAs for TAW through enforcement as well as advice and educate on the application of the CLAs

CLA Police (SNCU)

(STOOF)

(SFU)

(SNCU)

• Budget = €900,000
• Mission= provide

complementary instruments and information to agency workers on health & safety

• Nbr of agency workers =

211,000

Health & Safety

(STAF)

• Budget = €107 million
• Mission= provide

complementary pension benefits to agency workers

• Nbr agency workers

concerned = 660,000 (including 160,000 still working for an agency)

Pension (StiPP)

• Mission= Deliver quality

certificates to TWAs and carry

• ut compliance audits
• 2,400 agencies with certificate
• 4,700 inspections carried out

in 2010 and 322 companies removed

Self-regulation (SNA)

Social partners’ bipartite bodies in France for the Agency Work industry

• Budget = €150 million
• Mission= facilitate access to

training for agency workers

• Nbr agency workers

concerned = 40,700 in 2010

Training (FAF-TT)

• Budget = €44.8 million in 2010
• Mission: Providing additional benefits to

agency workers regarding access to housing, credit, childcare, car renting, complementary health insurance...

• Nbr agency workers = 129,000 in 2010

Social Fund (Fastt)

• Budget = €15.5 million
• Mission= facilitate

professional inclusion of agency workers

• Nbr agency workers

concerned = 40,600 in 2010

Inclusion (FPE-TT) (FAF-TT) (Fastt) (FPE-TT)

• Budget = €700,000
• Mission = To

commission surveys in order to increase the understanding of the TAW industry

Research

(OME)

• Mission = to inform

about and to stimulate compliance with existing legislation and CLAs for TAW

Compliance (CPPNTT)

• Mission= To provide welfare

and complementary pension schemes to agency workers

• Nbr of affiliated agency

workers = 50,000 in 2009

Welfare & Pension

(Reunica)

• Mission= To provide

complementary instruments and information to agency workers on health & safety Health & Safety

(CPNSST)

Conclusions: What are our points of common interest?

1. TAW to be recognised as a sector on its own

– Freedom of establishment and to operate for TWAs – Freedom to establish sectoral social dialogue at national and international level and to negotiate conditions of use of TAW

2. TAW as a sector to be regulated appropriately

– Any regulation on the PrEA industry should reach a balance between the

need to protect agency workers and the need to allow for the sound need to protect agency workers and the need to allow for the sound development of the industry – Sectoral social partners best equipped to define right level of regulation

3. Dark side of the industry to be eliminated

– To fight illegal/undeclared work and unethical agencies (= unfair competition and social dumping) – Enforcement of existing regulation is key

4. Protecting and advancing the temporary agency workers through social dialogue

– Promotion of fair treatment for agency workers: promotion of decent work, no fees to be charged to jobseekers, no replacement of striking workers, respect of freedom of association…

Look at the big picture!

The well

The rogue and unscrupulous side of TAW

The well regulated and reputable side of TAW

Thanks! Questions?

More info at: www.eurociett.eu denis.pennel@ciett.org