The regulation of temporary agency work has been an item on the European Union’s agenda for many years. Back in 1982 the European Commission put forward a draft directive aimed at regulating companies in the sector and ensuring protection and equal treatment for temporary employees.

This draft directive, amended in 1984, was intended to cover both agency work and fixed-term contracts, but it was never adopted.

Two events brought this matter back into the spotlight in the 1990s. First there was the adoption in 1989 of the Community Charter of Fundamental Social Rights for Workers, which aspires to harmonise and improve living and working conditions, including for temporary workers (see below). Then, in 1997, came the revision of ILO Convention No. 96 concerning fee-charging employment agencies. This Convention, initially adopted in 1949, had severely restricted the operations of such agencies, whereas in the Commission’s opinion the 1997 revision enabled the sector to spread its wings.

Temporary work agencies are currently one of Europe’s largest employers and claim to be a driver of job creation. There were approximately 3.8 million temporary workers, in full-time equivalents, in 2007 (the number doubled in the space of ten years). Many of these jobs are highly skilled, and both female and youth employment play a significant role. But the state of affairs is very uneven from one EU Member State to another: the penetration rate of temporary work agencies varies from 4.8% in the United Kingdom to 0.2% in Greece, with a European average of 2%. By the same token, regulatory or legislative approaches to this “industry” differed significantly at the outset. Apart from the fact that a triangular relationship exists between a worker, a company acting as a temporary employment agency, and a user company in which the agency employs the worker and places him/her at its disposal, the legal definitions, forms of regulation and labour relations practices vary considerably.

A study carried out in 1999 by the European Industrial Relations Observatory identified three main patterns of development:

• a general lack of any clear, specific definition or regulation of temporary work as a separate type of employment relationship (Denmark, Finland, Ireland and the United Kingdom);

• a specific legal definition and regulation of temporary work, relating mainly to the relationship between the temporary employment agency, the user company and the worker (Germany, Austria, Spain, Luxembourg, Norway, the Netherlands and Sweden);

• a specific legal definition and regulation of temporary work covering the relationship between the temporary employment agency, the user company and the worker, but also determining a specific status for temporary workers (Belgium, France, Italy and Portugal).

These substantial differences, coupled with the industry’s “development potential”, sparked a policy debate around the question of a European directive on temporary agency work. In 1990, as part of the action programme accompanying the Community Charter of Fundamental Social Rights for Workers, the Commission proposed introducing legislation in this area. The Charter in fact refers to the need for an alignment and improvement of forms of employment such as temporary work, stating that “the improvement must cover, where necessary, the development of certain aspects of employment regulations” (Article 7).

Nothing came of the Commission’s efforts, but that did not prevent the adoption on 25 June 1991 of a directive on improving the safety and health at work of temporary workers. This directive did not, however, cover other important aspects of agency work such as the duration and renewal of contracts, the circumstances in which user companies may have recourse to temporary staff, parity of pay and working conditions between temporary workers and equivalent permanent staff in user companies, and trade union rights and collective representation.

It was against this background, and at the Commission’s initiative, that the European social dialogue partners took up the issue as from 1995 (see Participants and Challenges), thereby lending structure to social dialogue in this sector.