The move comes weeks after construction union UCATT complained about the contracts to Department of Trade and Industry secretary Stephen Byers (26 February).
The contract stated that NCS workers would cease to be engaged by the company during absences caused by illness and advised those who fell ill to claim incapacity benefit from their local social security offices.
UCATT has agreed to drop a number of industrial tribunal actions against the company following a personal commitment from NCS managing director Sandy Palmer to drop the contract and pay operatives sick pay.
Palmer travelled to Doncaster last week to meet UCATT general secretary George Brumwell, who was attending a get-together of UCATT officials.
A UCATT spokesman said: “The two had a very constructive meeting in which our concerns about the contracts were made clear and Sandy Palmer agreed to address them.” A spokesperson for NCS said: “Following guidelines by the Federation of Recruitment Services, we are introducing sick pay.”