CBI urges Blair to fight further 'heavy-handed' EU labour laws

Industry chiefs yesterday challenged Tony Blair to demonstrate that the Government is still pro-business by using this weekend's Seville summit to urge European leaders to oppose the introduction of any further "heavy-handed" employment legislation.

The CBI, which has joined forces with its Italian equivalent in an effort to stave off any new EU labour market laws, said there was now a "more than adequate" framework in place to protect workers' rights.

Digby Jones said the EU had made no progress at all since the pledge in Barcelona two years ago to make Europe the most competitive trading area in the world thanks to "the dead hand of an opaque and unworkable system in Brussels".

UK and Italian business leaders are particularly concerned about the possible introduction of a new directive giving agency or temporary workers the same standards and conditions as full-time staff.

The directive would have a disproportionate effect on the UK because it accounts for an estimated 60 per cent of all agency staff in the EU. Only temporary workers who were employed in one place for less than six weeks or who were covered by a sector wide collective bargaining agreement would be exempted from the new law.

Mr Jones met Mr Blair to press his case earlier this week and said the Prime Minister supported the CBI. He also raised again concerns about the increase in employers' national insurance contributions and North Sea taxes, which were announced in the Budget.