Unions should “mind their own business” on non-standard labour

The Forum of Private Businesses (FPB) has warned of the dangers arising from potential new European Union ‘red tape’ governing the hiring and deployment of non-standard workers. Responding directly to the consultation opened by the European Commission’s green paper on labour law, the FPB – which represents 25,000 small and medium-sized UK businesses – has highlighted the economic risks associated with smaller companies having to cope with yet more bureaucracy.

“A significant number of our members already think that red tape relating to employment is hindering their possible expansion,” said the FPB’s chief executive Nick Goulding in conversation with SMT. “The last thing they need is for their hiring of contractors, agency workers and the like to be subject to additional rules as well.”

The green paper aims to kick-start a debate on the treatment of contractors, freelancers, self-employed workers, agency workers and those on fixed-term contracts. It’s an open-ended consultation paper, but for the FPB its origins are clear.

“This has come from the unions,” said Goulding. “Their aim is for this to lead to extra regulation. What’s interesting, though, is that none of the types of workers covered by the green paper are actually members of Trade Unions. Union members are generally employed workers, so why are they stepping outside of their mandate?”

Goulding continued: “It was the same with the Agency Workers Directive [referring to the proposal permanently stalled without agreement in the Council of Ministers to regulate workers hired from recruitment agencies]. Agency workers are not unionised, so why were the unions pretending to speak on their behalf and calling for regulation? The agency workers were not exactly falling over themselves asking for it. Neither are contractors and freelancers asking to be regulated now.”

Goulding is adamant the underlying reason is protectionism. “The unions are simply trying to shield their members from competition posed by people working on more flexible and less costly arrangements. It’s a classic case of grabbing the wrong end of the snake. The unions should be looking at why employers are finding it so costly to hire ‘normal’ employees. Red tape is hindering job creation.”

The FPB is now calling on the European Union to take note of a recent report published by the Organisation for Economic Co-Operation and Development which blames inflexibility and rigidity for sluggish growth, and calls for the removal of red tape that makes hiring and firing difficult.