ISME has warned that the introduction of the Temporary Workers Directive in Ireland would damage not only small business flexibility but also the interests of agency workers themselves.
ISME Chief Executive Mark Fielding said: "The bill would introduce more costs and another layer of bureaucracy that would not benefit business and would lead to the demise of the agency worker concept."
The bill proposes that agency workers, those employees who are recruited through employment agencies to fill temporary or part-time positions, will be entitled to the same rights as employees doing similar jobs in that company from day one.
This includes rights to pensions, sick pay schemes, etc.
The agreement allows the Social Partners to determine these entitlements.
"This new bureaucratic burden will deter many companies from using agency workers as the significant increase in costs will ensure that agency work is priced out of the market," said Fielding.
While obviously concerned about the direct cost of hiring agency workers, the association is also concerned at that existing employees would insist on maintaining the differential over the agency worker taking account of, experience, loyalty and seniority.
As the majority of smaller businesses use agency workers primarily as cover for other staff who may be on leave of absence, including maternity, sick and parental leave, the dramatic increase in costs will be completely unsustainable, especially when the agency fee (sometimes up to 30%) is factored into the cost equation.
Fielding outlined that companies will adjust their existing staff with the consequential reduction in productivity.
The directive, if introduced, will simply remove the flexibility that is so important not only to the business but the agency worker also.
"The key point here is that, from an SME perspective, the relationship is based on flexibility on the part of both parties and that is recognised in the business contract. In reality what is happening is that the company is utilising a service not hiring an employee," he said.