By Louisa Peacock
Under the current agreement between the CBI and TUC, temporary workers are due to get the same pay and working conditions as permanent staff after 12 weeks in a job, rather than on day one, as unions originally demanded.
Mr Cable pledged last week to review these regulations and 200 others that have yet to come into force and that will cost £19bn to implement.
Businesses are concerned that changing the agency workers' regulations in a bid to simplify them for employers could infuriate unions, who will walk away from the 12-week deal and insist on equal rights from day one.
Keith Luxon, human resources (HR) director at water company Veolia Water, which employs 2,200 people, urged the Government to weigh up any unintended consequences of revamping the law.
"One of the features of the UK labour market is its flexibility and active temp market," he said. "This allows businesses to respond quickly and effectively to changes in the market without forcing them to make long-term commitments they are unable to keep. We need to think very carefully before sacrificing this."
He warned that giving agency workers equal rights from day one would increase business costs and force the company to "hire less temps".
"Whilst I applaud the aim to reduce bureaucracy and red tape, it is vital that all implications are thought through," Mr Luxon said. "So much has happened over the last 13 years that you can't just wind the clock back and what many businesses want is a period of stability."
Christian Armstrong, HR chief at Thistle hotels, which relies on temps during busy periods, agreed that without the 12-week rule, companies would "think twice about hiring agency workers" and become powerless to respond to business needs.
He called on ministers to consult with business about any changes to the law. "The Government has to make sure whatever measures are put in place, it encourages implementation. The best way to do that is to take on board employers' views."
Manufacturers' body the EEF warned it could take a year to agree the final set of regulations, which must be implemented by November 2011, giving companies little time to prepare.
However, Neville Upton, chief executive of The Listening Company, a call centre employing 4,000 people, of which up to 10pc are temps, said the incoming legislation needs to change to reduce the burden on business. "We need as much flexibility to run our business the way we want to at the moment. We are competing in a global environment in a tough recession," he said.
A TUC spokesman refused to comment before the Government's review findings, but did not rule out unions reneging on the 12-week deal.
Other business regulations approved by the previous Government now up for review include elements of the Equality Bill and rights for fathers to claim up to six months of a mother's maternity leave.
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Under the current agreement between the CBI and TUC, temporary workers are due to get the same pay and working conditions as permanent staff after 12 weeks in a job, rather than on day one, as unions originally demanded.
Mr Cable pledged last week to review these regulations and 200 others that have yet to come into force and that will cost £19bn to implement.
Businesses are concerned that changing the agency workers' regulations in a bid to simplify them for employers could infuriate unions, who will walk away from the 12-week deal and insist on equal rights from day one.
Keith Luxon, human resources (HR) director at water company Veolia Water, which employs 2,200 people, urged the Government to weigh up any unintended consequences of revamping the law.
"One of the features of the UK labour market is its flexibility and active temp market," he said. "This allows businesses to respond quickly and effectively to changes in the market without forcing them to make long-term commitments they are unable to keep. We need to think very carefully before sacrificing this."
He warned that giving agency workers equal rights from day one would increase business costs and force the company to "hire less temps".
"Whilst I applaud the aim to reduce bureaucracy and red tape, it is vital that all implications are thought through," Mr Luxon said. "So much has happened over the last 13 years that you can't just wind the clock back and what many businesses want is a period of stability."
Christian Armstrong, HR chief at Thistle hotels, which relies on temps during busy periods, agreed that without the 12-week rule, companies would "think twice about hiring agency workers" and become powerless to respond to business needs.
He called on ministers to consult with business about any changes to the law. "The Government has to make sure whatever measures are put in place, it encourages implementation. The best way to do that is to take on board employers' views."
Manufacturers' body the EEF warned it could take a year to agree the final set of regulations, which must be implemented by November 2011, giving companies little time to prepare.
However, Neville Upton, chief executive of The Listening Company, a call centre employing 4,000 people, of which up to 10pc are temps, said the incoming legislation needs to change to reduce the burden on business. "We need as much flexibility to run our business the way we want to at the moment. We are competing in a global environment in a tough recession," he said.
A TUC spokesman refused to comment before the Government's review findings, but did not rule out unions reneging on the 12-week deal.
Other business regulations approved by the previous Government now up for review include elements of the Equality Bill and rights for fathers to claim up to six months of a mother's maternity leave.
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