Marcela Gallegos assembled 77 boxes per minute in a Chicago factory that supplies pizza for Costco. David Fields drove thousands of dollars of freight on a forklift in one of Walmart’s consolidation centers in Hammond, Indiana. Marcela and David worked for Costco and Walmart, but they were not employed by these retail giants. They are among the millions of workers doing jobs like collecting trash for Waste Management, packaging razors for Philips Norelco and cleaning hotels for Doubletree Inn, but who are employed as “temps” by third-party staffing firms.
Calling Marcela and David “temporary workers” is a misnomer. Each worked for the same company for close to a year. More and more, major American companies hire so-called temps for extended periods of time, sometimes alongside workers they hire directly, performing identical work. This type of outsourcing has become a permanent feature of many business models.
This disjointed work relationship, with gargantuan corporations at the top distancing themselves from the workers who do their bidding at the bottom, is a distinctive and growing characteristic of the way people find jobs and do their work today. The number of those in staffing jobs, which make up the majority of work in the employment services industry, is at an all-time high of 2.8 million people, or two percent of the entire workforce, as our report, “Temped Out” shows. An even greater number of workers are employed by franchises, subcontractors or as freelancers. More than three quarters of Fortune 500 firms use third-party logistics firms to manage their warehouses and move their products.
At best, this layering of employers creates confusion over who’s the boss. At worst, the presence of multiple bosses increases the likelihood of labor law violations, while also obfuscating who is ultimately accountable.
The move from direct employment to outsourced labor gives major companies outsized power over their workforces, even as they disclaim responsibility as employers. Here’s how: Big businesses at the top can put the squeeze on a first tier of logistics companies, which in turn choose from an army of smaller staffing companies competing for business in an atmosphere of cutthroat competition. For these outfits to make a buck, they almost necessarily have to cut corners – like safety training and equipment, worker’s comp and wages – leading to degraded working conditions in the jobs they offer. In fact, staffing workers’ median wages are a whopping 22 percent below that of all workers, regardless of industry.
[Read: Protesters asking fast-food companies for higher pay handcuffed at rallies]
The staffing industry is no longer just supplying office assistants. It’s moved into other industries as well. In fact, production and transportation and material moving jobs now make up 42 percent of the industry. In factories across the South and Midwest, temps are manufacturing car parts for companies like Nissan and BMW, alongside permanent workers who usually earn more for the same work. With the shift toward temping in manufacturing, some of the most hazardous jobs in the economy are becoming even more dangerous.
Temp workers are seriously injured and killed on the job more often than direct-hire workers, with analarming number killed on their first day of work. Untrained temp workers unfamiliar with their workplaces fall to their deaths or get crushed by machinery. Earlier this year two Florida sanitation workers supplied by the staffing agency Labor Ready were killed on the job in a two-week period. One fell from the back of a garbage truck. The other was run over.
Temp workers who fear being replaced if they take breaks or speak out against harsh working conditions are more likely to be seriously injured – as was the case with Mark Jefferson of New Jersey, who died of heat exhaustion while collecting garbage for Waste Management in 2012.
For decades, both manufacturing and service workers in the United States turned to unions as a means of identifying and addressing issues like wages and safety on the job. America’s growing temporary workforce doesn’t have that option. An outdated labor law decision requires the permission of both the work site employer and the staffing agency for workers to unionize.
Staffing industry jobs need not be degraded and dangerous jobs. We can implement solutions to protect the rights of the 2.8 million staffing workers and the many millions of America’s franchised and outsourced workers. We should follow the lead of most European and Latin American countries and restrict temporary work to truly temporary jobs created by staff shortages or special projects. We should guarantee temporary workers the same wages and benefits that direct hires receive and restrict outsourcing in hazardous jobs. Lastly we should enforce existing laws and pass new measures to ensure that Costco, Walmart and other leading U.S. companies take responsibility for the people who make and move their products.
Related to
About the Author
Rebecca Smith
Director of Work Structures, National Employment Law Project
