Article 4 sets clear limits to prohibitions and restrictions that may be imposed on the use of temporary agency work. These are only justified on grounds related to the protection of temporary agency workers, to ensure that the labour market functions properly and that abuses are prevented. EU Member States are obliged to review prohbitions and restrictions on temporary agency work until and to report to the European Commission.
Article 5 establishes the principle of equal treatment for temporary agency workers. The basic employment and working conditions shall be - for the duration of the assignment at the user company - equal to those of a worker employed directly by that company to occupy the same position. Article 5 allows for derogations from this principle for open-ended contracts providing pay between assignments (Article 5, paragraph 2), to uphold collective labour agreements (Article 5, paragraph 3) or based on agreements of social partners (Article 5, paragraph 4).
As with several other EU Directives in the area of employment and social policy, the political purpose of the Directive on temproary agency work is to set common minimum standards for temporary agency work in the EU. The political goals this serves is to prevent "unfair competition" between different member states. Common minimum standards are preferred by politicians to prevent a "race to the bottom" where every country tries to deregulate to attract business, and, theoretically, all end up "losing" (at least the politicians and union leaders would lose power). The political goals are to ensure a higher standard of living and quality of life, consistent with the aims of the Treaty of the European Union. Critics contend that the policies increase labour market inefficiencies and ultimately raise unemployment levels and reduce business output, leading to lowered living standards for those not already securely seated in permanent positions in the labour market.
- see, Art.3 TEU and Defrenne v. Sabena (No.2) where the European Court of Justice holds that Europe is not just an economic union, but intended also for social development.