Temp agencies and the ILO - a case of false advertising

29 May 2015 Feature
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Temp agencies don't need to convince employers of the advantages of agency work - the limits to their growth are political, namely laws and regulations. So Ciett, the global agency lobbying arm, asserts that the growth of their members' business advances the ILO's decent work agenda: the more people are employed by Manpower, Adeco, Kelly etc. the more decent work there is. Ciett seeks ILO endorsement for its efforts to roll back barriers to the expansion of agency work and the destruction of permanent jobs.

It's a clever sales pitch, but it works only to the extent that the buyer ignores what the ILO is actually saying. Ciett's latest attempt to wrap itself in the mantle of the ILO is organized in connection with their annual World Employment Conference held this year in Rome for three days beginning May 27. "Labour market experts from across the globe urge governments to introduce labour market reforms swiftly in order to kick-start their economies," says their press release, subtitled "ILO, OECD and employment & recruitment industry stress the role of labour market adaptability in driving growth." More explicitly, "Experts underline the importance of agile and adaptable labour markets in stimulating economic growth and job creation. In practice, this means removing old-fashioned rigidity and unjustified restrictions concerning legitimate flexible forms of labour."  "We should abandon the preoccupation with specific types of contracts, and instead focus on how we can enhance the position of workers on the labour market, while supporting the needs of employers", says Ciett President Annemarie Muntz. "We are here to emphasize the benefits of the triangular relationship between the worker, the client company and the agency", adds Vice-President Hans Leentjes.

In the run-up to the Rome conference, Ciett "welcomed" the publication of the ILO's recent World Employment and Social Outlook for "documenting the changing nature of work" and, implicitly, lending support to Ciett.

The "changing nature of work" is a familiar employer riff - for the past three decades, employers have been busting unions, destroying permanent jobs and deregulating everything they could deregulate. The results are presented as a force of nature - a response to globalization, technology, trade, changing life-styles, anything will do as long as it removes human agency and the role of employers. Workers are then told they have no choice but to submit and 'adapt'.

The ILO publication does indeed document the destruction of permanent jobs in those parts of the world where, for a limited period, provided one ignored significant parts of the workforce, permanent, direct employment could be regarded as the "standard form of employment". The three decades following World War II - decades of enormous gains for workers  - were historically exceptional in this and in other regards. Given the continued prevalence of informal and "non-standard" forms of employment - temporary, agency, and self-employment - in many parts of the world, the surge in casualization in the wealthier countries of the globe means that "non-standard" jobs are now the global norm.  The ILO links this transformation to the rising incidence of poverty, insecurity, exclusion and inequality. Nowhere does it endorse an expansion of agency work, and it specifically cautions against the implementation of neo-liberal formulas for further labour market deregulation as a recipe for growth. Ciett's advertsing works only on the assumption that no one reads the report.

Temporary employment agencies (who increasingly drop the 'temporary' from their self-description) build market share through expanding the available pool of workers. Their ultimate achievement is the "user enterprise" without a single permanent direct employee. Yet they cynically promote themselves as "stepping-stones" - indispensable agents of "transitioning" workers into permanent jobs.

In February this year, the ILO convened a Tripartite Meeting of Experts on Non-standard Forms of Employment. The background report prepared by the ILO, which, refreshingly, did not rely on Ciett statistics, found that "The stepping-stone hypothesis is confirmed for some countries (Denmark, Italy, the Netherlands and the United States)… However, when temporary work is further liberalized and the pool of temporary workers increases, longer term evidence, as seen in Japan and Spain, suggests that workers who start off with a temporary job are more likely to transition between non-standard work and unemployment over the course of their working life than workers who start with a permanent contract. In these cases, temporary work ceases to be a stepping stone. The stepping-stone hypothesis is not confirmed in the case of temporary agency workers in Germany, Sweden or certain parts of the United States, where temporary agency workers seem to remain in this specific type of relationship or face increased "churning"… In all countries reviewed, even where the stepping-stone mechanism is at work, non-standard workers have a significantly higher rate of transition into unemployment or into inactivity - sometimes nearly tenfold - as compared to regular workers." No wonder Ciett wants to turn away from the "preoccupation with specific types of contracts."

Further liberalizing temporary work and increasing the pool of available workers is precisely what the agencies seek. They can find no support for this position in the latest findings of the ILO.  The ILO is calling for effective protection for all workers, regardless of their employment status. They are not endorsing the status quo, or calling for more of the same.

The ILO report identifies the lack of corporate investment as the key factor in retarding recovery, linked in a vicious circle to the stagnant or declining share of wages in global output. Investment, not temp agencies, is what creates jobs. The report could have drawn the conclusion that extensive public investment is the only antidote to insufficient corporate investment, but unions will have to pursue that argument - and fight for it - as part of a broader agenda. The ILO has given sufficient documentation to confirm that agency work is a social hazard. It should be addressed through the hierarchy of hazards approach used to reduce other workplace hazards. The first choice is eliminating, then replacing the hazard, followed by strict controls to contain potential toxicity.