Key Theme for Today…..

2. Key Theme for Today….. Agency Worker Regulations 2010 How is the recruitment industry responding?

3. Objective of AWR Main purpose = protection of temporary workers through the application of equal treatment Equal treatment will be on the grounds of pay and basic working and employment conditions The deal allows for 12 weeks of placement in the same job before equal treatment applies Day 1 rights (Hirer)

4. The UK Recruitment Industry What is the UK Recruitment Industry: Large Corporate Agencies SME Organisations Specialist Agencies Master & Neutral Vendors Contractor & Umbrella Companies

5. The UK Recruitment Industry The REC Annual Recruitment Industry Trends 2009/10 survey: • £19.7 billion turnover • Temporary & Contract turnover £17.8 billion • No. of Temporary & Contract workers 879,302 • In excess of 10,000 separate recruitment businesses

6. How is the industry affected? Data supplied by CIPD

7. Challenges -The Clients Perspective • “From the standpoint of employers, it is vital to have clarity both about what equal treatment means in practice and about the process for implementing it. It is also important that the regulations are clear about the responsibilities of the end-user.”  Chartered Institute of Personnel and Development (CIPD) • “Agencies and end-users are united in their desire to see the UK Regulations maintain important flexibilities in the UK labour market and that they clearly define the responsibilities of all parties”. Confederation of British Industry (CBI)

8. Challenges -The Clients Perspective “Hiring activity is not always HR, it is often done by line managers who will extend an assignment week by week so are unlikely to know or follow a specific process” “There will be a rocky period during implementation, but temporary workers are there to fulfill a need which won’t go away” “Some industries and sectors won’t have pay scales and formal salary bandings”

9. Challenges…….Client • What is AWR? • Reviewing internal procedures on hiring • Identifying comparators and sharing data • Evaluate current pay rates for temporary staff • Tracking the 12 week derogation period • Day 1 rights – vacancies and access to facilities • Identifying way forward that supports need for flexible workforce

10. Challenges…….Agency • Client awareness of AWR • Capturing comparator data • Evaluate current pay rates for temporary staff against comparator data • Tracking the 12 week derogation period • Administration and IT systems • Identifying way forward that supports supply of flexible workforce

11. Meeting the Challenges….. What has the industry done? • REC Agency Work Commission & AWR Summits • Provided on-going feedback to BIS on guidance • REC Model Contracts and documentation • AWR Specific training courses • Invested in legal advice on policies, processes and contracts • Invested in IT system changes to manage the complexities of the • 12 week calendar (tracking pauses & breaks / linking similar job roles in same client) • Parity pay changes including holidays

12. Meeting the Challenges….. • Client awareness – what is AWR? • Client seminars in conjunction with legal expertise • Continued engagement with clients to understand implications of AWR • PR awareness campaign undertaken by REC • Capturing comparator data including Day 1 rights • Specific comparator checklists to capture data • Advising clients on what’s in or out of scope • Working in partnership with clients to provide data on agency usage • Providing feedback and advice on other basic work and employment conditions that apply including day 1 rights

13. Meeting the Challenges….. • Evaluate current pay rates for temporary staff against comparator data • Working together to highlight differentials in rates and holiday • Reviewing agency worker usage – lengths of assignments; level of usage; peaks and troughs • Tracking the 12 week derogation period – • Building IT systems and administration processes to retain comparator data, track assignments, flag in key timings • Providing management information for on-going analysis to manage the business • Identifying Way Forward

14. Meeting the Challenges….. • Identifying Way Forward • Re-structure of entry level rates and job descriptions • Advising of market rates • Continued ad hoc usage (less than 12 weeks) – no change • Payment between assignments (Swedish Derogation) • Implementation of new systems • De-bugging the myths and avoidance!

15. Where are we now? Up Date: 23% of employers remain unaware of the regulations 44% of employers still undecided on approach 42% of employers not planning to change how they utilise flexible labour 13% prepared to pay higher rates of pay 83% of employers say their use of flexible labour will stay the same or increase over the next 12 months Data supplied by REC – Jobs Outlook Sept 2011

16. Where are we now? • Aware of the need to have continued dialogue with Clients • Monitoring the impact of the regulations on: • Clients • Temporary Workforce • The Industry • Ready for implementation!