Tightening rules for employment agencies

The goverment decided to improve the system of temporary employment via agencies resulting in dispute between unionists, emloyers, government, and the president in the second half of 2014

Illustrative stock photoIllustrative stock photo (Source: SME)

“This amendment aims to increase legal protection of temporary employees,” said the OZ KOVO trade union group board vice-chair Monika Benedeková. “It classifies temporary employment agencies because many of them use practises harming employees and the state particularly by avoiding the law on wages.”

The government adopted the amendment after it overcame the veto of President Andrej Kiska on January 28. The amendment introduces the so-called shared responsibility principle, meaning that temporary employees must earn the same salary as regular employees if they do the same work. If a temporary employee earns less, the agency would have to pay the difference from its own budget. If the agency fails to cover this cost, the difference would have to be paid by the company.

Kiska returned the bill objecting to what he said were inappropriately evaluated impacts of the changes on employment and job creation. The president also considered the opinion of employers who fear the inappropriate increase in costs and bureaucracy, the SITA newswire reported.

“In this case it is not about that we will catch agencies red-handed, as many people especially unionists represent to the public,” said Radovan Maxin from the Federation of Employers’ Associations (AZZZ). “But it is above all about the amendment having negative effects on employers using them.”

In 2013 as many as 1,037 agencies were in business, while in 2014 the Central Office of Labour, Social Affairs and Family (ÚPSVaR) issued licences to another 58 agencies, according to ÚPSVaR spokesperson Veronika Černá.

Dealing with disobedient agencies 

The amendment further includes the so-called presumption of temporary assignment. This means that if a company signs a contract with another firm operating in the same sector or field, rather than with an employment agency, and the work meets the criteria of temporary employment, it will be considered a temporary assignment and the employer will have to follow the rules set by the law for temporary employment. Additionally, the amendment bans temporary assignments for hazardous work classified in the highest category, and sets a 24-month cap on the maximum period of time that a temporary employee can work for the same firm.

The new rules are a reaction to the latest trend among agencies to provide their customers with Czech employment contracts or to pay wages to their employees via travel orders which are counted in state compensations for travelling to work. Firms which want to save as much as they can are rather blind to these practices, the Hospodárske Noviny daily wrote in August 2014.

These rules will negatively affect the employment rate in Slovakia, according to Maxin, adding that they also have signs of constitutional violation, particularly in legal-employment relationships without reflection of free will of both employees and employers.

Too many players

Slovakia has too many temporary employment agencies; McROY Group personnel agency Board Chairman Luboš Sirota said in a March, 2014 interview with Hospodárske Noviny, adding that even around 1,000 would be too many. Only 0.8 percent of employees found a job via an agency, while in Europe it is 1.6 on average, according to him.

“It means that most of them do not employ anyone,” Sirota told the daily.

The number in 2014, however, decreased because of tightened rules obliging them to send to ÚPSVaR a report of their activities by March 31, according to the Pravda daily.

ÚPSVaR cancelled licences for 256 of them in 2013 and started dealing with 584 cases of abuse of the law by agencies in 2014, according to Černá.

“The market will be thus cleansed of agencies which have not been displaying any activities,” the manager of Grafton employment agency Petra Balážová said, as quoted by the Sme daily.

Further changes needed

A problem is that the state responds too slowly to agencies that are still finding new ways to abuse their employees. The result is that employees have minimal rights and are even abused, according to Benedeková.

“Employment via agency has lost its original purpose and meaning since it should have a temporary character,” Benedeková said. “Today’s unbearable state is the result of 10 years of unregulated employment via agencies and, of course, some agencies use it for their benefit. That is why unions support this step to the more precise legislation, which should guarantee more rights to temporary employees.”

AZZZ sees Slovak temporary employment as non-standard and wants to change it as well. However, it disagrees with new rules favoured by unionists, proposing its own ideas. The Labour Ministry promised the association that it will discuss them during preparation of an amendment to the law on employment services, said Maxin. 

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