The European Parliament has passed a proposal to give temporary staff and contractors the same employment rights as permanent staff.
On the day Mandelson's Department for Business, Enterprise and Regulatory Reform promised to cut red tape for small businesses, Brussels seems intent on moving in the opposite direction.
The Temporary Agency Workers directive gives temps the same rights as permies from day one - although UK workers might have to wait 12 weeks to get the same rights.
The directive will enforce equal treatment for both types of workers in terms of pay, holidays, working time, rest periods and maternity leave. Staff must have equal access to collective facilities like canteens and creches and better training for agency staff when working and in between assignments.
The directive must still be passed into UK law.
Jon Taylor, Head of Employment at emw law, said: "With the UK labour market in such a fragile state and unemployment rising, the Government should seriously reconsider whether now is the right moment to be imposing additional burdens on businesses.
"Making the labour market less adaptable at such a critical time for the UK economy could make the storm harder to weather. Undermining the cost savings and flexibility benefits of using temporary workers would be detrimental to all concerned."
A BERR spokesman said: "The Government hopes to introduce the necessary legislation in the current Parliamentary session. As we've consistently said, there will be a detailed consultation on the UK implementation of the Directive. Of course, we will look to avoid unnecessary burdens and costs for business while ensuring agency workers receive the appropriate protections."
The UK government, CBI and TUC agreed the 12 week wait for rights in May. ®