Precarious work arrangements deserves attention and action by new Secretary of Labor

In the weeks ahead, President Obama will announce his pick to replace Hilda Solis as the 26th Secretary of Labor.   It’s the Cabinet-level position with the resources and best platform to promote strong policies for the benefit of U.S. workers—-from fair, living wages and safe working conditions, to job training and family leave benefits.  I hope the President’s nominee takes the time to read “At the company’s mercy: Protecting contingent workers from unsafe working conditions,” a new report by the Center for Progressive Reform (CPR).  It describes how work arrangements that don’t fit the traditional employer-employee relationship (i.e., full-time, year-round jobs with defined wages and benefits) are more prevalent than ever in the U.S.  The authors, which include law professors Thomas McGarity and Sidney Shapiro, write:

“Stability is no longer the hallmark of a relationship between workers and employers, nor is a direct connection between the entity that writes a paycheck and the people who control the worksite.  Policy researchers have noted that employers are shifting “from a ‘reactive’ use of temporary workers to fill the jobs of absent employees or to supplement permanent employees during a busy period to a ‘systematic’ use, ‘in which entire job clusters and industries are staffed with agency workers indefinitely.’”

The report profiles four industries with business models that rely heavily on contingent workers: farming, construction, warehousing, and hotels.

“A common feature of the industries is that they cannot, by their very nature, move jobs offshore, so employers have adopted a different strategy for reducing labor costs–they replace full-time employees with temporary workers.  The workers in these industries, who typically come from vulnerable socio-economic backgrounds, do not feel empowered to engage in individual or collective action to improve working conditions, even though they are not protected against hazards that are inherent to their forms of work (especially ergonomic hazards), even though they lack paid sick leave or health insurance to mitigate injuries and illnesses.”

The characteristics of these contingent workers, such as only 5 percent of farm workers having some education beyond high school, and near exclusive reliance on immigrant labor, makes them particularly vulnerable to abuse.  Plus, they have little job security, low wages, and minimal opportunities for advancement.  These precarious work arrangements deserve attention and action by a new Secretary of Labor.  And the timing couldn’t be better.  As Lizzie Grossman explained, job growth in the U.S. now relies heavily on contingent labor.

“In 2010 more than 27% of the 1.12 million jobs created were temporary staffing positions, and employment at temporary jobs agencies accounted for 91% of the non-farm job growth between 2009 and 2011. More than 2.5 million people in the United States go to work each day as temps, and about 90% of all US businesses now use temporary labor.”

CPR’s report offers a dozen recommendations that a new Secretary of Labor could use as a roadmap to improve working conditions for contingent workers in the U.S.   They include:

  • requiring training for contingent workers to ensure they understand their wage, safety and other labor rights;
  • instructing OSHA and BLS to coordinate with NIOSH to assemble data on working conditions in the industries that rely heavily on contingent workers;
  • redirecting funds from the OSHA programs that benefit large and corporate employers to ones that support community-based groups that serve contingent workers;
  • instituting enforcement “sweeps” in workplaces where labor is supplied by the temporary employment industry;
  • advocating legislative changes to extend labor protections to domestic worker and farm workers, and provide workers a private right of action against employers who violate health and safety regulations; and
  • proposing a regulation to protect high-risk workers from musculoskeletal injuries, such as contingent workers in warehousing and hotels.

Reports on the prevalence and growth of precarious work arrangements in the U.S. is nothing new.   The Government Accountability Office examined the issue in a 1991 report, “Workers at risk: Increased numbers in contingent employment lack insurance, other benefits,” and a June 2000 report entitled “Contingent workers: Incomes and benefits lag behind those of rest of workforce.”  Both reports relied heavily on research in the social science literature showing the disparities in wages, benefits and legal protections for contingent workers.

Globally, since at least the 1990′s the United Nation’s International Labour Organization (ILO) has examined the growth and social consequences of non-traditional work arrangements.   The ILO uses the term “precarious” to define working conditions that are insecure, uncertain and unpredictable.  The ILO doesn’t shy away from explaining why contingent work arrangements are preferred by some employers and industries.

“The scope and different forms are ever expanding, as unscrupulous employers are always trying to circumvent regulations or to find loopholes in regulations in order to increase the profitability of their business at the expense of their employees.  Nonetheless, common characteristics of precariousness are the absence or the insufficient level or rights and protection at the workplace.  While informal employment is obviously precarious, this is also increasingly true for many forms of formal employment including sub-contracting, temporary contracts, agency work, fake self employment and involuntary part-time.”

On January 1, a new law took took effect in Massachusetts that addresses some of the abuses faced by workers employed by temporary staffing agencies.  Staffing firms are now required to provide employees the name of the worksite employer; information about the type of job being assigned and any requirement for special clothing, tools, equipment, training, or licenses, and any costs charged to the employee; the designated pay day and the actual hourly rate of pay, overtime pay, and compensation; among other things.  The law also prohibits staffing agencies from charging employees for procuring a job, and from assessing other fees that would reduce a worker’s pay below the minimum wage.

The new Massachusetts’ law is the first of its kind in the nation.  It was the handiwork of a coalition of faith leaders, labor organizations, the industry and state agencies.   With it as a model and the CPR recommendations as a roadmap, the new Secretary of Labor should be able to hit the ground running to better the lives of contingent workers.