New York, NY—Jobs supplied by temp agencies reached a record high of 3.2 million jobs last year, and temp agency employment has grown four times faster than overall U.S. employment since the end of the Great Recession in 2009. But except for three states—Massachusetts, Illinois, and California—legal protections for temp workers are largely nonexistent in the United States, even though temp workers are uniquely susceptible to illegal conduct, injury, and abuse on the job, according to a new policy brief released today by the National Employment Law Project (NELP).
“Temp work today is very different than what it was in the past. It’s not just office temps anymore,” said Laura Padin, senior staff attorney with NELP and author of the study. “Temp workers today are disproportionately people of color. More and more temp workers are working in blue-collar industries like construction, manufacturing, and logistics, where low pay, no benefits, and risk of injury are often the norm. As the temp sector grows, improving labor standards becomes more urgent and necessary.”
According to NELP’s analysis, 9 of the 10 occupations that added the most temp jobs between 2014 and 2017 paid a median hourly wage below $15 an hour; several of these occupations had higher-than-average rates of workplace injuries. The occupation that added the most temp jobs during that period—more than 61,000 new temp jobs—was the ”Laborers and Freight, Stock, and Material Movers” occupation, which consists of workers who manually move freight and stock, and whose injury rate is 3.4 times the average rate.
Temp workers face significant wage and benefit penalties when compared with permanent, direct hires. Full-time temp workers, as a group, make 41 percent less in wages than workers in standard work arrangements. As for benefits, only 12.8 percent of temp workers have employer-provided health insurance, compared with more than 50 percent of workers in standard work arrangements. Temp workers also face higher rates of wage theft than permanent workers, as well as a substantially greater risk of getting injured on the job.
Black and Latinx worker are over-represented in temporary staffing work. While Black workers constitute 12.1 percent of the overall workforce, they make up 25.9 percent of temp workers. Latinx workers are 16.6 percent of all workers, but 25.4 percent of temp workers.
Race and gender discrimination in the hiring and placement of temp workers is rampant, with some temp agencies and their clients using code words to signal their preference for or disfavor of workers of a certain race or gender.
Among developed nations, the United States has some of the weakest labor protections for temporary workers. The Organisation for Economic Co-operation and Development (OECD) scores countries on the strength of their employment protections, from 1 (weak) to 5 (strong). With respect to regulating temp work, the United States scored 0.3, tied for last place with Malaysia.
Only three states—California, Illinois, and Massachusetts—have passed laws to rein in abuses in the temp and staffing industry and to provide some baseline protections to temp workers:
- In 2012, Massachusetts passed the Temporary Workers Right to Know Act, the first state law aimed at raising labor standards specifically for temp workers. Under the law, staffing agencies must give essential information in writing to each temp worker before a new assignment, including the name and contact information for the staffing agency, the agency’s workers’ compensation carrier, and the company where the employee will be working; a description of the job; and work hours and pay. Although such “right to know” provisions seem basic, they represent a seminal change for the workers, who often had no notice of the terms and conditions of their employment. The law also prohibits staffing agencies from charging employees for certain expenses, and limits the cost of any transportation provided by the agency to its workers.
- In 2017, Illinois passed the Responsible Job Creation Act, which strengthens protections for temp workers and day laborers. Like the Massachusetts law, it requires staffing agencies to provide workers with essential information about each assignment (e.g., wages, hours worked, all deductions) and to maintain detailed records about each temp worker and client assignment, which could provide evidence of unfair and illegal hiring and assignment practices by temp agencies. The law prohibits common exploitative practices, such as not compensating workers who show up at an assignment but are not given work. It also requires agencies to attempt to place workers into permanent positions when such positions arise, and to register with the state labor department. Finally, it provides a private right of action and strong penalties for violations.
- IN 2014, California passed AB 1897, which provides that any business that contracts with a staffing agency or other labor contractor shall be jointly liable for any failure on the part of the labor contractor to pay wages owed or to secure workers’ compensation insurance for any workers supplied to the business.
“As corporations expand their use of temp workers in more types of jobs, policymakers need to take action to rein in the illegal employer conduct and abuses that are all too common in the temp industry today. Three states in the U.S., and dozens of countries around the world, have already taken the lead and shown what can be done. More states need to follow suit.”
READ THE STUDY:
Lasting Solutions for America’s Temporary Workers
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