Morrisons are having discussions with recruitment agencies about using a loophole to get-out of the new Agency Workers Regulations (AWR).

The AWR was created so that temps get the same rights as permanent members after the temp has been at the same employer for 12 weeks or more. This has forced some employers to look at legitimate routes to waive these rights.

One such option is called the “Swedish derogation”, which basically means the temps are hired directly by the employer and therefore no longer classed as agency worker and so therefore not covered by this new ruling. This of course brings other discrepancies but shows how high usage employers of temps are trying to think outside the box to cope with the new AWR. The end result though will be that these employers will ultimately try to find ways to reduce temp requirements, which is a negative point to recruitment agencies who have built sound business models to supply a service to these employers.

I do think that this is a case of everyone trying to find their feet. It was obvious that these new regulations were going to cause massive disruption but the end result is that this rule exists and recruitment agencies have to work towards it. I also don’t think it is a surprise now that many employers are coming up with starter salary packages to make their comparable as much in their favour as possible.

Recruitment agencies are preparing themselves for a tough year ahead with `The centre for Economics and research` stating that the economy will be at a virtual standstill next year.

With the Euro zone crisis now worsening and the global economy weakening. The worry is that there will be little investment into the UK economy and with other European countries possibly looking for bails outs such as Spain and Portugal, UK taxpayers will have to help out with these bailout packages.

The Bank of England has recently helped with quantity easing by providing a £75 billion injection, however many see this as delaying the inevitable a double dip recession. There have been calls to reduce interest rates further from 0.5% to 0.25% but even if this does not happen, it is probably safe to say interest rates will not increase before mid 2013.

Finance ministers from across the G20 will be in Paris this weekend discussing the euro zone crisis. There have been noises of a continent-wide rescue package worth up to two trillion Euros.

I have to say that I am quite worried about the coming few years, almost a make or break scenario for many countries and the Euro as a whole. With news China’s economy is also on the decrease, it seems that this will have a negative effect on the Global economy and it is very difficult to see where this is all heading towards….

The monthly report by the REC and KPMG would have concerned recruitment agencies as their results showed that the number of vacancies grew by its slowest rate since August 2009.

Bernard Brown from KPMG said that it is only a matter of time before the job market starts to contract. With many employers now cautious over the uk and global economic outlook it is unsurprising that they have taken this approach. It is also quite apparent that there are not enough private jobs being created to combat the amount of job loses in the public sector, one of the hopeful predictions the government made.

The signs point to a higher unemployment figure and without government intervention it seems that the situation could get worst. Medical staffing showed a decline in placements, Accounting staffing was steady and the strongest demand was in Engineering staffing.

The only positive we can look at is at least it was still an increase in vacancies but how much longer this will be the case, only time will tell.

Recruitment agencies are looking at ways of legitimately getting round the new Agency Workers Regulations that stipulates that any temp supplied will have the same benefits as a permanent member of Staff after 12 weeks.

Randstad recently took the view that in some cases they will follow the “Swedish derogation” model. This is a proven model that basically means the recruitment agency takes on the agency worker as a permanent member of staff and would therefore have to carry on paying them in times of now work, which can be as little as 1 hour per week. Randstad did say they will not be aggressive with this model as having agency workers as permanent staff does have it drawbacks as well.

Other recruitment agencies have informed their temporary staff that they cannot be considered of permanent benefits until they have had the same training as the permanent staff.

Then there are employers that are using recruitment agencies to build up a bank of staff for the employer and it is the agency that runs this operation on the employers’ behalf.

It is of course quite apparent that many recruitment agencies and employers are looking at ways round this AWR, methods that will prove successful, well only time will tell. However one thing is clear is that the new regulations are not being embraced by anyone involved and view this new legislation as a hindrance rather than a stimulus to economic growth.