Each year, approximately 2% of New Hampshire’s workforce is employed through the temporary staffing industry. Temporary staffing firms hire and compensate workers to perform jobs for a third-party client company, which pays the temporary services agency a pre-arranged fee for staffing services. In this contractual arrangement, the temporary staffing company serves as the employer of record, while the client employer determines pay rates, job duties and onsite work activities of the temporary workers assigned to the client’s facility. In some industries, such as light manufacturing, it now common for businesses to retain only a small, specialized “core group” of regular direct-hire employees while staffing all other production operations with temporary workers.
Overall, temporary employees are paid less and are less likely to have employer-provided benefits, such as affordable health care insurance and paid time off, compared to regular, direct hire workers employed in the same jobs. Many so-called temporary jobs are not short-term. Some New Hampshire employees report that they were assigned to temporary jobs in an ongoing position with the same company for multiple years before getting a permanent job offer.
Temporary employees are also more likely to experience job-related injuries and fatalities than regular employees, because they are more likely to be new to a job or industry, are unfamiliar with workplace safety standards and sometimes receive only rudimentary training for the high-risk jobs they are assigned to perform.
The “triangular” employment relationship created by temporary staffing is fundamentally different from the standard “direct” employment relationship that serves as the foundation for most state and federal labor regulations to protect the wages, workplace rights and health and safety of New Hampshire employees. Yet current New Hampshire law makes no distinction between temporary staffing companies that make profits by employing workers to farm out to third-party clients, and conventional employers who directly hire, pay and control the working conditions of people who work for them. This gap in employment law puts working people employed through the temporary staffing industry at greater risk of poor job outcomes, lower wages and unsafe working conditions.
For example, NH temporary workers frequently report that they were unclear about what firm actually employed them and which manager had the authority to approve absences or help with problems on the job. Currently there is no New Hampshire statute requiring temporary staffing companies to provide temp workers with clear and complete information about the their terms of employment or special work requirements when they are assigned to a new job.
Client companies that use temporary staffing services to supply workers to meet normal demands of business operations can exploit the murky relationship of temporary employment to shed liability for the fair treatment and job safety of the temp workers they co-employ. Several large New Hampshire manufacturers are known to use temporary workers to staff ongoing production jobs, and have offices of temporary staffing companies operating on the business premises to ensure a continuous flow of new and “permanent” temporary workers. The growth rate of the number of temporary staffing firms in New Hampshire has been robust, even during the recent economic downturn when other types of business establishments were declining in number.
Employment through the temporary staffing industry does not conform to the standard understanding of the employer-employee relationship and the basic legal protections for workers that derive from it. Temporary staffing practices put workers at greater risk for mistreatment, financial hardship and job injuries and should be appropriately regulated, similar to the way that the state of New Hampshire currently regulates employee leasing companies.
FOR MORE INFORMATION:
U.S. Bureau of Labor Statistics, Monthly Labor Review December 2016
Temp workers, permanent effects: how temps changed the nature of the U.S. workforce
ProPublica, February 2014
U.S. Lags Behind World in Temp Worker Protections
National Employment Law Project, September 2014
Temped Out: How Domestic Outsourcing of Blue-Collar Jobs Harms America’s Workers