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You can find the current article at its original source at https://www.theguardian.com/commentisfree/2016/nov/16/gig-economy-recruitment-agencies-employment-rights
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| In the gig economy, recruitment agencies are the gangmasters | In the gig economy, recruitment agencies are the gangmasters |
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| “Recruitment agency: an organisation that matches employers to employees and vice versa; an intermediary in the labour market” – or so the dictionary tells us. But, given recent findings that agencies are using aggressive tax avoidance schemes at a time when new benefit caps are driving single parents into poverty; that some agencies have conned low-paid temporary workers into buying worthless accident insurance; and, from my own research, that agencies are enabling the undercutting of workers’ rights and wages by pitting migrant workers against local people, it would be truer to life if we described recruitment agencies as arbiters of capitalism and the mass exploitation of workers. | |
| It is estimated that recruitment agencies employ 1.2 million people every day. Agencies are now the vehicle by which desperate workers are driven into the arms of exploitative employers, and they are fundamental to understanding the new age of precarity in the labour market and the “gig economy”. | It is estimated that recruitment agencies employ 1.2 million people every day. Agencies are now the vehicle by which desperate workers are driven into the arms of exploitative employers, and they are fundamental to understanding the new age of precarity in the labour market and the “gig economy”. |
| There are hundreds of examples – from Sports Direct to NHS cleaners – of agencies actively undermining the rights of employees. One recent case was brought to light by the trade union GMB. Agency workers at an Asos warehouse in Grimethorpe, South Yorkshire, are being subject to a “flexing clause”, which employers argue was introduced to help manage peak times and quiet periods. | There are hundreds of examples – from Sports Direct to NHS cleaners – of agencies actively undermining the rights of employees. One recent case was brought to light by the trade union GMB. Agency workers at an Asos warehouse in Grimethorpe, South Yorkshire, are being subject to a “flexing clause”, which employers argue was introduced to help manage peak times and quiet periods. |
| What it actually means is that workers can arrive at the warehouse only to be told they will be starting two hours later (with these two hours unpaid), or indeed work two hours later in the evening. When workers refuse, they are disciplined. This practice can cause a great deal of stress – particularly for those with childcare commitments. These flex contracts are likely to be in breach of employment law because it means workers aren’t actually being paid the minimum wage. | What it actually means is that workers can arrive at the warehouse only to be told they will be starting two hours later (with these two hours unpaid), or indeed work two hours later in the evening. When workers refuse, they are disciplined. This practice can cause a great deal of stress – particularly for those with childcare commitments. These flex contracts are likely to be in breach of employment law because it means workers aren’t actually being paid the minimum wage. |
| This story won’t come as a surprise. We have known that recruitment agencies have been the pimps of the labour market for some time. What the Guardian’s new investigation has found is that they are not only promoting the use of temporary and zero-hours contracts where they are not appropriate, but using aggressive tax avoidance schemes that are depriving the taxpayer of hundreds of millions of pounds a year. | This story won’t come as a surprise. We have known that recruitment agencies have been the pimps of the labour market for some time. What the Guardian’s new investigation has found is that they are not only promoting the use of temporary and zero-hours contracts where they are not appropriate, but using aggressive tax avoidance schemes that are depriving the taxpayer of hundreds of millions of pounds a year. |
| What a time for these findings to come to light. Earlier this month, a new benefits cap was introduced which reduces the household benefit cap from £26,000 to £20,000 outside London, affecting more than 80,000 households, according to the Institute for Fiscal Studies. The new work and pensions secretary, Damian Green, has also confirmed that the government will be making the £3.4bn cuts to universal credit planned by the last parliament, despite fears that it will push working families into poverty, and protests by backbench Tory MPs. Recruitment agencies are therefore robbing workers of a decent standard of living in two ways: directly, through undermining rights and pay, and indirectly by contributing to the demise of social security and our public services. | What a time for these findings to come to light. Earlier this month, a new benefits cap was introduced which reduces the household benefit cap from £26,000 to £20,000 outside London, affecting more than 80,000 households, according to the Institute for Fiscal Studies. The new work and pensions secretary, Damian Green, has also confirmed that the government will be making the £3.4bn cuts to universal credit planned by the last parliament, despite fears that it will push working families into poverty, and protests by backbench Tory MPs. Recruitment agencies are therefore robbing workers of a decent standard of living in two ways: directly, through undermining rights and pay, and indirectly by contributing to the demise of social security and our public services. |
| This is maddening. Just like Mike Ashley, Philip Green and other fat cat capitalists, this is this sort of behaviour that reminds us how the economy is no longer serving everyday people. | This is maddening. Just like Mike Ashley, Philip Green and other fat cat capitalists, this is this sort of behaviour that reminds us how the economy is no longer serving everyday people. |
| There is another, relatively unexplored problem that recruitment agencies have created: friction between migrant and local workers. In 2009, I carried out some research in Hull, where there were a growing number of Polish migrants working in factories via recruitment agencies, especially in food packing and processing. | There is another, relatively unexplored problem that recruitment agencies have created: friction between migrant and local workers. In 2009, I carried out some research in Hull, where there were a growing number of Polish migrants working in factories via recruitment agencies, especially in food packing and processing. |
| At one agency, a lead recruiter was candid about the way in which the agency focused on recruiting only Polish and eastern European workers. This, she said, was in response to business demands for workers with “a stronger work ethic”. When pushed further, she admitted that Polish workers were less likely to demand higher wages and to know the rights temporary workers were entitled to. | At one agency, a lead recruiter was candid about the way in which the agency focused on recruiting only Polish and eastern European workers. This, she said, was in response to business demands for workers with “a stronger work ethic”. When pushed further, she admitted that Polish workers were less likely to demand higher wages and to know the rights temporary workers were entitled to. |
| When I spoke to local people, they were all too aware that agencies were not taking them on, and were justifiably angry. At the time I couldn’t foresee how much such outcomes – which are due to lack of employment safeguards, rather than immigration per se – would fuel anti-immigration sentiments in the years to come. | When I spoke to local people, they were all too aware that agencies were not taking them on, and were justifiably angry. At the time I couldn’t foresee how much such outcomes – which are due to lack of employment safeguards, rather than immigration per se – would fuel anti-immigration sentiments in the years to come. |
| It is therefore odd that while immigration has become a growing public concern, recruitment agencies have continued to flourish. At the Centre for Labour and Social Studies conference last month, the general secretary of the Unite union, Len McCluskey, spoke of this race to the bottom culture, calling for us to focus on safeguards for workers, and proposing that any employer wishing to recruit labour abroad could only do so if they are either covered by a proper union agreement, or by sectoral collective bargaining. Such solutions get to the heart of problems in the labour market and would help us move away from an unhelpful and misleading focus on the number of immigrants. | It is therefore odd that while immigration has become a growing public concern, recruitment agencies have continued to flourish. At the Centre for Labour and Social Studies conference last month, the general secretary of the Unite union, Len McCluskey, spoke of this race to the bottom culture, calling for us to focus on safeguards for workers, and proposing that any employer wishing to recruit labour abroad could only do so if they are either covered by a proper union agreement, or by sectoral collective bargaining. Such solutions get to the heart of problems in the labour market and would help us move away from an unhelpful and misleading focus on the number of immigrants. |
| Of course, we must acknowledge that some progress has been made on the rights of agency workers – through holiday pay legislation, for example. However, such legislation is itself used for abusive ends. For example, the Agency Workers Regulations were introduced to ensure equality of pay for long-term temporary workers compared with their permanent counterparts. Instead, this legislation has been used as a means of undercutting permanent staff. | Of course, we must acknowledge that some progress has been made on the rights of agency workers – through holiday pay legislation, for example. However, such legislation is itself used for abusive ends. For example, the Agency Workers Regulations were introduced to ensure equality of pay for long-term temporary workers compared with their permanent counterparts. Instead, this legislation has been used as a means of undercutting permanent staff. |
| It is important to remember, however, that not all recruitment agencies are the same. Unfortunately for the good ones, the worst have damaged the reputation of the industry. Recruitment agencies do not simply represent a cog in the capitalist system, but rather the oil that allows it to function. When faced with all the challenges of the labour market, it can be overwhelming. But having been reminded of the many ways in which agencies are abusing workers, and how far they have veered from their supposed original purpose, it’s clear where our battle must begin. | It is important to remember, however, that not all recruitment agencies are the same. Unfortunately for the good ones, the worst have damaged the reputation of the industry. Recruitment agencies do not simply represent a cog in the capitalist system, but rather the oil that allows it to function. When faced with all the challenges of the labour market, it can be overwhelming. But having been reminded of the many ways in which agencies are abusing workers, and how far they have veered from their supposed original purpose, it’s clear where our battle must begin. |