Benefits and Costs: Contingent staffing is on the rise for several reasons. Historically, of course, employers have always used “temps” to fill in for permanent employees who were out sick or on vacation. But today’s desire for higher productivity also contributes to temp workers growing popularity. Productivity is measured in terms of output per hour paid for and temps are generally paid only when they’re working – not for days in other words. Many firms also use temporary hiring to give prospective employees a trial run before hiring them as regular employees.
The benefits of contingent staff don’t come without price. They may be more productive and less expensive you recruit and train, but generally cost employers 20% to 50% more than comparable permanent workers (per hour per week) since the agency gets a fee. Furthermore, people have a psychological reference point to their place of employment. Once you put them in the contingent category, you’ve saying they’re expendable. The Employment Law feature addresses relevant laws, in the United States. In India, such workers are covered by The Contract Labor Regulation & Abolition Act, 1970.
The numbers of temporary and freelance workers are increasing all over the world. Alemi Takada is a noted Japanese freelance animator ho manages her work load and does projects for companies all over the world through an Internet agency that represents about 15,000 freelancers in media and publishing.
Federal against recently rounded up about 250 illegal contract workers in 60 Wal-Mart stores. The raid underscores that employers must understand the status of the contract employees who work on their premises under the auspices of outside firms, handling activities like security , foodservice(or, as Wal-Mart’s case) after hours store cleaning.
Whether hired directly or through agencies, temp workers can pose legal risks to employers. One problem is that these temps are often are often temps in name only – they area really regular employees. Microsoft Corp – certainly a sophisticated company – had a pay at $ 97 million settlement several years ago to employees it had mischaracterized as temporary. Microsoft did not pay these employees certain benefits. A federal court held that despite their temp titles these temps were actually regular Microsoft employees eligible for the benefits.
Under the law, it is not the label (such as temporary worker) that counts but the facts of the case. The more control the employer and its managers and supervisors exercise over the agency’s temp employees, the more likely it is that the court will view the temporary employees as regular (as at Microsoft).
Furthermore, as two lawyers put it, for purposes of most employment laws, with certain limited exceptions employees of temporary staffing firms working in an employer’s workplace will be considered to be employees both of the agency and of the employer.
Managers and supervisors must therefore keep in mind that even for staffing company employees, the more control they exercise over the employee, the more likely it is that the law will view the employees as regular employees of the firm, and so eligible, for instance for the employer’s benefits. The prescription is to treat the temp employees as if the temp agency is in fact his or her employer. Do not train the temp employee, or negotiate pay with him or her. Let the agency do that.
Mangers must also guard against treating temporary workers who come from tempo agencies as if they have no employee rights. For example, some supervisors may assume that they can dismiss these employees arbitrarily or ignore federal age and hour laws. In fact, temporary workers, like all workers have significant legal rights.
Guidelines for using Temporary Employees:
1. Do not train your contingent workers.
2. Do not negotiate the pay rate of your contingent workers.
3. o not coach or counsel a contingent worker on his / her job performance
4. Do not negotiate a contingent worker’s vacations or personal time off.
5. Do not routinely include contingent workers in your company’s employee functions
6. Do not allow contingent workers to utilize facilities intended for employees.
7. Do not let managers issues company business cards, nameplates, or employee badges to contingent workers without HR and legal approval.
8. Do not let managers discuss harassment or discrimination issues with contingent with contingent workers
9. Do not discuss job opportunities and the contingent worker’s suitability for them
10. Do not terminate a contingent worker directly.