Once the envy of full-time employees, agency workers are now at bottom of the labour market, writes Gerald Flynn

AGENCY WORKERS used to be the envy of many employees in the late 1990s, when they were often technical specialists working through contractors for large companies unable to hire full-time computer programmers. They made a killing on the Millennium Bug which, with hindsight, looks as if it was one of the greatest scare scams ever perpetuated on top-level decisionmakers.

Remember the warnings that video recorders would implode when faced with 00-00-2000 on the timer and those foolhardy enough to fly on New Year's Day even risked falling from the skies. Well, lots of computer programmers made a great living between 1998 and 2000 providing assurances that company servers could cope with letters and invoices dated January 1st, 2000.

Most of these were agency workers enjoying large bonuses and paid on an hourly consultancy rate. They were viewed rather enviously by the "wage slaves" in these organisations tied to fixed pay scales for their 39- hour fixed week. These agency workers had very little security of employment and no holidays, but that hardly mattered when they were earning three to four times what their "employee" colleagues were being paid.

Of course that bubble began to burst in 2001 but the phenomenon of agency workers has continued to grow, boosted by dozens of new recruitment agencies going overseas to attract young workers eager to enjoy some of the financial benefits associated with the boom. It all tied in with a tight labour market and a steady supply of hard-working, eager young people without many family or child-rearing responsibilities.

The mainstream view was that here were thousands of footloose and fancy-free workers who were highly flexible and would as easily work in Bunclody as Bantry, Ballinasloe or Bundoran. The reality that emerged with the Gama Turkish work gangs, on €3 an hour, or the low-skilled Baltic workers picking mushrooms or vegetables showed that the new style of agency workers bore little comparison to the "young yuppies" of the late 1990s.

The issue of agency workers is a growing phenomenon throughout the EU, partly sparked by moves to get around employment legislation covering entitlements for part-time and contract workers.

At its most basic, agency work is just impersonal lumps of labour that you can hire by the day for the minimum daily rate of €66 as long as you pay an intermediary a premium or "hiring fee" of about 30 per cent or €20 a day for finding them.

At a higher level, agencies provide opportunities for professional staff to come from outside the EU to secure employment and training in Ireland and contribute to the country, as can be seen in the better regulated areas of agency healthcare workers.

Over the next few weeks the issue of agency workers will be a "deal breaker" in the national pay talks, according to the more assertive trade union leaders. Officially they want all agency workers to enjoy the same benefits as direct employees from their first day in employment, though some are suggesting that they could live with a six-week lag until all employment protections kicked in, which is what the current draft EU Temporary Agency Workers' Directive proposes.

At the other extreme, some employers assert agency workers are key to the survival and profitability of their sector and under no circumstances should they have the same rights as regular employees, as it would inhibit labour market flexibility. Since 1982 the European Commission has been tinkering with a possible directive to regulate temporary agency work with a view to establishing some level of equality with permanent employees' safeguards and entitlements. The 2002 draft agreement has been consistently opposed by Britain, Germany and Ireland, with sticking points over when any equal treatment provisions should rake effect.

A recent survey by KPMG accountants and the Chartered Institute of Personnel and Development indicated employers are not as tied to the concept of total flexibility as might be suggested by some employers' lobby groups. More than one in four employers (27 per cent) responding to the survey of 1,500 employers and managers felt that workers should never qualify for the same rights as permanent employees.

But one in five (21 per cent) said agency workers should be given the same "pay and contract of employment" conditions from the first day of employment with a given employer.

In all one in three (35 per cent) said this should apply within the first six months of employment, while a further third preferred a qualifying period of at least six months.

Earlier this month some concrete evidence was presented to a private session of the Oireachtas enterprise committee on the actual practice of agency workers in an unnamed large haulage and warehousing company. About one-third of employees are now agency workers, nearly all from overseas, and their basic pay hourly rates were €13.20, compared to €18.50 for permanent staff. They did not "qualify" for shift premiums, overtime, sick pay or pension contributions, and were not covered by the unfair dismissals legislation.

With such a scenario it is fairly obvious why unions like Siptu last Monday, and Ictu yesterday, have been making agency work legislation a priority. While agency workers' protection will become the first bargaining chip in the new round of pay talks next month, it is likely that the real decisions will be taken at EU level once the Lisbon Treaty is safely out of the way. Equal treatment with permanent employees after somewhere between six weeks and six months is the likely outcome.

But the problem remains that nobody is very sure how many agency workers we have in the workforce - Siptu estimates about 30,000, but it is certain the proportion has grown significantly in the past five years. The Central Statistics Office is analysing data from the Quarterly National Household Survey, which specifically asked respondents about their work status, and Fás is also undertaking research in the area.

Of course, when the issue of agency workers is regularised we will probably have a spate of independent, self-employed "consultants" which, no doubt, could lead to an EU temporary consultants' directive some time in the next decade.

Gerald Flynn is an employment specialist with Align Management Solutions, Dublin. gflynn@alignmanagement.net