Temporary Workers

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John Klein Hesselink, Sarike Verbiest, Anneke Goudswaard, TNO, the Netherlands

Introduction

Temporary employment contracts are often used by employers to manage fluctuations in personnel needs. Many sectors of industry experience these fluctuations, which are often seasonal. This creates uncertainty about the continuousness of demand for work, which is transferred from employers to employees through the use of temporary contracts. Besides job and income insecurity, there is also a risk that precarious work is assigned to temporary employees [1]. Employment and occupational safety and health (OSH) legislation are aimed at preventing excesses, but rules differ from country to country. This article gives an overview of the different applications of temporary employment from the European Union’s (EU) perspective, the risks and effects for the employees, and measures to prevent negative consequences.

Definitions of temporary employment in the EU

Temporary employment is a concept that contains a multitude of contractual employment relationships. There is no single definition for this kind of employment, but the common aspect is temporality. This temporal aspect, in combination with other aspects of employment contracts, makes it possible to define four broad groups of temporary employment.

Fixed-term contracts

These contracts are like permanent contracts, but contain a limitation on the length of employment. This is often applied in uncertain economic times or to extend the legal probation period of permanent contracts that may be legislatively too short. Sometimes this is formulated as a temporary or fixed-term contract with the prospect of transferral to a permanent job. Fixed-term contracts can also be used to staff a project. This is called a fixed-term contract for a certain period. Fixed-term contracts are often prolonged with new fixed-term contracts, but also with permanent contracts. Prolongation with a permanent contract may be legally-charged, depending on employment legislation in that country.

Third-party arrangements

These contracts are arranged with labour brokers or employment agencies acting as intermediaries between the employee and a third-party organisation where the actual work is done. Other types of third-party arrangements exist, such as labour pools, but the three-party construction also covers a multitude of other labour contract arrangements. Allocations are almost by definition temporary from an economical point of view, because intermediary parties charge money for the provided services, which adds to the labour costs. However, other forms of permanent third-party arrangements are emerging; for instance, when employees have a permanent contract with a temporary employment agency, or when companies outsource the contractual obligations of their personnel. This latter form is called ‘payrolling’.

Work on demand

Work on demand is a broad term covering a wide range of flexible employment contracts[2]. Work on demand is interlinked with the social, economic and technological changes that have given rise to new forms of employment across Europe (e.g. platform work, gig workers). On-demand work offers increased flexibility to businesses to contract work when needed. Agriculture, hotels and restaurants, and the wholesale and retail sector often regulate fluctuations in staffing needs in this way. The type of employment contract varies greatly and may contain permanent and fixed-term elements. Often these contracts involve additional obligations, such as the obligation to appear when called. The most precarious form of these contracts is the zero-hour contract.

Self-employment

Contractual arrangements with independent contractors and the self-employed are also limited in time, as they are usually hired to make something or to provide a service, for instance in the manufacturing, construction and transportation services. Even the terms employee and employer are not relevant; instead a contractor negotiates with a client. These kinds of arrangements only contain appointments on the agreement that the self-employed party delivers. Legal obligations related to employer-employee responsibilities are mostly lacking. In many countries these labour relationships are legally situated somewhere on the borderline of labour laws and business laws.

Legal aspects of temporary employment

Temporary employment is used by employers to transfer the risk of discontinuity of work to the employees or contractors. In permanent (or indefinite) employment contracts the employer is obliged to pay the employee for the appointed hours of duty or when there is no work. After the first oil crisis in 1973 [3], when worldwide competence became manifest, employers found these rules to be too restrictive, and searched for exceptions to cope with these periods of work discontinuity. The process of finding temporary contract arrangements is still on-going and legislation often follows, but it also lags behind when new forms of temporary employment emerge.

Fixed-term contracts

It was found that the most natural way to solve the problems of work discontinuity was to include temporality in the labour contracts. Temporality is included in the labour laws of most western industrialised countries, and legislative refinements to clarify the nature of temporality were made in 2011 [4]. On 25 June 1991, the European Commission implemented the Council Directive 91/383/EEC [5] on measures to encourage improvements in workplace safety and health for workers with fixed-term or temporary contracts. An evaluation report in 2015 [6] concluded that fixed-term and temporary workers are still comparatively more exposed to occupational health and safety risks than workers with other types of employment contracts.

Third-party arrangements

Agency work in the European Union is fully accepted, but in a small number of member states a sufficient regulatory framework has to be further developed [7]. Primarily, agency contracts need mandating rules to guarantee wages, holidays, breaks, working time, etc. [8]. On 5 December 2011, the EU Directive on Temporary Agency Work 2008/104/EC came into effect [9]. It states that all temporary agency workers should be treated the same as regular workers from their first day at work in relation to:

  • the duration of working time, rest periods, night work, annual leave and public holidays;
  • pay;
  • work done by pregnant women and nursing mothers, children and young people;
  • action taken to combat discrimination on the grounds of sex, race or ethnic origin, religion or beliefs, disabilities, age or sexual orientation.

Furthermore, temporary agency workers must have equal access to facilities such as childcare and must be informed of permanent employment opportunities. Laws to fit temporary employment agency contracts into labour law are often complex and include references to other laws that regulate labour [10].

Work on demand

The Eurofound study Work on demand: Recurrence, effects and challenges[2] provides an overview of the types of employment contracts and legislation across the European countries. Several countries have taken steps to increase the social protection of the workers with on-demand contracts and to fight abuse. EU legislative acts such as the part-time work directive 97/81/EC is based on the principle of equal treatment between atypical workers and comparable 'standard’ workers. However, deviations from this general principle are possible under particular conditions such as period of service or time worked.

There is still an employment protection gap for many workers who work with such atypical employment contracts[11]. The EU directive 2019/1152 on transparent and predictable working conditions[12] addresses some of these issues. With regard to work on demand the directive requires for instance that member states take measures to prevent abusive practices:

  • limitations to the use and duration of on-demand or similar employment contracts;
  • a rebuttable presumption of the existence of an employment contract with a minimum amount of paid hours based on the average hours worked during a given period;
  • or other equivalent measures that ensure effective prevention of abusive practices.

Self-employment

Self-employment has a number of advantages in that it can be used as a driver for entrepreneurship and job creation. especially if more self-employed become employers. Therefore, promoting entrepreneurship and self- employment is high on the agenda of European, national and regional policymakers because it has a strong potential to create jobs, strengthen the EU’s innovation capacity and give unemployed and disadvantaged people an opportunity to fully participate in society and the economy[13]. The self-employed also enjoy greater flexibility, autonomy and job satisfaction than employees. However, there are also problematic aspects associated with self-employment, as the self-employed tend to work longer hours than employees, and in some countries they do not enjoy the same level of social protection as employees.

Data on temporary workers in the EU

According to the European Working Conditions Survey (EWCS) around 12% of the employees are temporary workers[14]. This percentage has remained stable between 2005 and 2015 (figure 1). The various contractual forms are distributed differently across Member States, with nine Member States having a proportion of self-employed and temporary employees above the average. For instance, Poland has the highest percentage of temporary workers (23%) and Greece the highest of self-employed workers (32%).

Figure 1 – Employment status based on self-reported status (EWCS, 2005, 2010, 2015) - %

Temp fig1.jpg

Source: [14]

Data based on the Labour Force Survey (LFS) show a more detailed picture of temporary work. The number of temporary contracts as well as the temporary employment rate (number of temporary employees as a percentage of all employees) show a strong cyclical (and seasonal) pattern[15]. Both the number of contracts and also temporary employment rate declined at the onset of the recession (2008) and tended to increase with the recovery as many new hires are employed on temporary contracts (figure 2). The first data on the effects of the containment measures taken during the covid-19 pandemic (2020), show that non-standard workers, e.g. part-time workers, self-employed and workers hired on fixed-term contracts, are most affected by the containment measures[16].

Figure 2 – Trends in open-ended and temporary employment, EU, 2006 – 2016 (LFS)

Temp fig2.jpg

Source: [15]

There are significant differences in the distributions of temporary employment by personal, job and company-related characteristic. A study of Eurofound[17] looked into the likelihood (expressed as an odds ratio) of one employee holding a temporary contract compared with another employee. The result show that the odds of holding a temporary contract are:

  • much higher for employees aged 20–29 years;
  • slightly higher for female than male employees, although not statistically significant;
  • higher for employees with low educational attainment and lower for highly educated employees;
  • notably higher for non-nationals than for nationals, although they fall with the years of residence in the country;
  • much higher in agriculture and some service sectors (extraterritorial organisations, arts and entertainment, and education) than for employees in manufacturing, while they are lowest in the financial, mining, and activities of households as employers sectors;
  • slightly higher for employees working in medium-sized companies (20–49 employees);
  • higher for part-time than for full-time workers, and higher for employees having more than one job than for those having only one.

The transition from one employment status to the other varies. 2.6% of employees with a permanent job move into temporary work while 27.5% of employees with a temporary job move into permanent employment. Improving the possibilities of transitions between temporary work and a permanent job is a way of reducing inequalities in the labour market. Most temporary workers do not work voluntarily on a temporary basis. Data show that more than 60% has a temporary contract because they could not find a permanent job[18].


OSH problems related to temporary contracts

In Europe [19] [20], but also in other western countries [21], temporary employment is regarded as a risk related to problems with occupational safety and health (OHS), but also to other occupational risks such as reduced employability and lower pay. These relationships are discussed in this section.

For an up-to-date picture of the OHS risks, the EWCS offers an extensive overview. The figures in this section therefore are again derived from the data visualisation tool [22]. For the mapping of the OSH risks, the EWCS differentiates between three groups: employees with a permanent contract, employees with another work arrangement and the self-employed. The employees with other work arrangements are in fact the employees with a temporary or fixed-term contract. This group includes the employees with a fixed-term contract, agency workers and other employment contracts discussed in the previous section.

Health and safety

Employment conditions affect health inequalities. A comprehensive review of the empirical evidence suggests the existence of links between non-standard work, including part-time, fixed-term and subcontracting, and poorer occupational health and safety outcomes, including injury rates, poor physical health and hazard exposures as well as poorer psychosocial working conditions[11]. A European study [20] indicates that workers in new forms of employment and contracting practices, including precarious contracts (e.g. temporary or on-call workers) are more vulnerable. These workers often perform hazardous jobs, work under poorer conditions, and often receive less health and safety training than permanent employees. This increases the risk of work-related accidents and health problems. The review study of Virtanen and colleagues [23] suggests higher psychological morbidity among temporary workers compared to permanent employees. Morbidity may be higher in temporary jobs with high instability/insecurity and in countries with a lower number of temporary workers, because these countries may not have specific policies for this group of workers.

Underhill and Quinlan [24] found in a range of studies that precarious employment is associated with adverse health and safety outcomes. Among the temporary workers, the temporary agency workers are most vulnerable. They experience a higher incidence of workplace injury and a greater likelihood of more severe injuries. Temporary agency workers also experience economic pressures, more than other types of precarious workers. They are vulnerable to disorganization risks such as mismatched placements, lack of familiarity with host workplaces, and fractured communication. These contribute to workplace risks and create barriers to improving experience.

The review study of Kim and colleagues [25] reveals that the type of welfare regime may be an important determinant of employment-related health. Flexible workers in Scandinavian welfare states report better or equal health status in comparison to permanent employees. By contrast, flexible work in other regimes (Bismarckian, Southern European, Anglo-Saxon, Eastern European, and East Asian) is found to be associated with adverse health outcomes.

For an overview of some figures on health and safety, figure 3 compares the answers of the three groups asked to consider various health, safety, and well-being risks. The figures show that are no major differences in how work is affecting the health of the employee. Around a quarter of the respondents to the EWCS think that their work has a negative impact on their health. Workers with a permanent job often have an employment which requires them to wear personal protective equipment (37% compared to 32% for other work arrangements and also self-employed).

With regard to job satisfaction, the differences are greater. 20% of the workers with other work arrangements report that they are 'not at all' or 'not very' satisfied with their job. Amon workers with a permanent contract and self-employed this percentage is respectively 12 and 11%.

Figure 3 - Comparison of health and safety risks/job satisfaction as reported by employees with a permanent employment contract, employees with other work arrangements and self-employed in EU28 (EWCS 2015)

Temp fig3.jpg

Source: [22]


Although effects are relatively small in the EWCS 2015, results suggest that employees with fixed-term contracts have greater work intensity, more physical risks and less access to social resources, work resources and rewards than employees with indefinite contracts (see figure 4)[26]. Employees with no contract or other type of contract report higher physical risks, and their jobs offer lower levels of social resources and work resources, and less in the way of rewards.

Figure 4 - Demands and resources by employment status – EU28 (EWCS 2015)

Temp fig4.jpg

Source: [26]

Training and employability

Lack of training might have implications for OSH, because there is a higher risk of accidents and exposures if you don’t have the necessary skills to carry out your job. In particular temporary agency workers have less access to supplementary training than other employment types [20]. Training is also related to the labour market chances of temporary workers; with less training also the employability of temporary workers decreases. Research indicates that experienced employability of voluntary as well as involuntary temporary employees, leads to less burn-out and stress [27].

Figure 5 shows the percentage of workers who report that they are not very well informed about health and safety risks related to their job and the percentage of workers receiving on the job training.

The percentage of employees reporting that they are not very well informed about health and safety is almost twice as much among workers with other contracts (17%) than those with a permanent job (9%). They receive also less training on the job: 31% compared to 40%.


Figure 5 - Comparison of training issues as reported by employees with a permanent employment contract, employees with other work arrangements and self-employed in EU28 (EWCS 2015)


Temp fig5t.jpg

Source: [22]

Preventive measures and interventions

The OSH Framework Directive of 12 June 1989, defines the measures to encourage improvements in the safety and health of workers at work[28]. The directive lays down requirements for employers with regard to risk assessment, worker participation, health surveillance, etc. The directive does not make a distinction between employees with a temporary or a permanent job. The requirements apply to all employees.

In addition directive 91/383/EEC[5] contains supplementary measures to encourage improvements to the safety and health at work of workers with a fixed-duration employment relationship or a temporary employment relationship. The directive aims at ensuring that temporary workers are afforded the same level of protection of safety and health at work as other workers in the user undertaking and/or establishment.

The Directive includes the following requirements:

  • Workers with a fixed-duration or temporary employment relationship must not be treated differently to permanent workers with regard to health and safety protection, particularly with regard to access to personal protective equipment.
  • Preventive and protection services: Preventive and protection services (OSH advisors) of companies are to be informed of the assignment of workers with a fixed-duration or temporary employment relationship.
  • Information for workers: Before a worker takes up any activity, he or she must be informed of any risks that the job may entail. This information must cover special occupational qualifications, skills or medical surveillance requirements.
  • Training for workers: Every worker must receive appropriate training to carry out a particular job, taking into account his or her qualifications and experience.
  • Medical surveillance: Workers undertaking work that requires special medical surveillance must be provided with such appropriate medical surveillance.

An evaluation report (2015)[6] of the directive points to the fact that although the directive aims at ensuring the same level of protection for temporary workers, they are still more often exposed to occupational risk factors compared to other workers. The authors emphasise that this should not be interpreted as failure of the Directive since the characteristics of temporary workers differ and that they are employed in high risk sectors, such as construction and agriculture, which are characterised by physically demanding work with higher risk.

The report on emerging psychosocial OSH risks[19] concludes that only few attempts have been undertaken until now to protect workers in precarious contracts. A possible intervention would be to implement policies which oblige employers to provide workers under fixed term contracts and in temporary agency work with instruction and training on how to perform their work safely before they start working, as well as at regular intervals. Also realistic hazard assessment should be exercised. The report gives suggestions for immediate and extended action, also for foreign workers who are often employed in precarious temporary jobs.

Recommendations for immediate action:

  • Provide a common framework aiming at greater harmonization to protect all workers, independent of their type of contract.
  • Enhance the processes and methodologies of labour inspection to guarantee full respect for the legal framework, especially with respect to safety and health at work for all workers, independent of their type of contract.
  • Establish mechanisms to guarantee equal access to training in general and OSH training in particular for all workers, independent of their type of employment contract.
  • Assess the main difficulties experienced by (migrant) temporary agency workers with respect to organizational safety and health.
  • Assess the main difficulties and restraints experienced by companies and organizations employing (migrant) temporary agency workers, when implementing organizational safety and health measures equally for all workers.

Recommendations for longer term actions

  • Develop measures to promote greater involvement of social partners with respect to OSH for (migrant) temporary agency workers, and other flexible workers, such as self-employed offering their labour to a company.
  • Perform more extensive research on occupational risks for (migrant) temporary agency workers, and other flexible workers.

The studies of Virtanen and colleagues [23] and of Kim and colleagues [29], cited in the preceding section, suggest that the type of welfare regime may be an important determinant of employment-related health of temporary workers. More stability, security and specific policies on temporary work may help. In finding a balance between flexibility and job security, the job security of employees may be improved by offering increasingly permanent elements in the labour contracts after a certain period of time or number of contracts. Securing income, for instance minimum wages, is also a measure that may prevent abuse.

At the same time, flexibility for the employers must be kept in order to remain competitive in today’s business environment. Arguments about the precarious side of temporary work are often contradicted by pointing at the ‘stepping stone’ perspective. It offers people the opportunity for entering the labour market and developing working experience. Skills and career development can be collectively appointed and may help new employees to improve their employability. Health, safety and well-being may be protected by ensuring that temporary workers have the same protection as permanent workers. Finally the advantages of temporary work in combining work and family life must be valued and arranged. Employing more people with family responsibilities is beneficial for employees, employers and the economy in general. Scheduling optimal working hours, shift work possibilities and self-rostering are useful instruments to provide mutual flexibility within a secure (permanent) employment relationship and thus without making use of flexible contracts.

The EWCO study on very atypical contractual arrangements recommends actions that guarantee both flexibility and security in the labour market through a degree of regulation and monitoring of these forms of work [30]. Actions and policies addressing the need for flexibility on the one hand and greater protection for workers on the other, have been devised in the main for more general forms of temporary work, but are still rare for the new very atypical forms. In some countries a range of policies and measures are in place to support and encourage self-employment [31]. These include:

  • financial support;
  • support services, training, mentoring and advice;
  • measures to reduce bureaucracy and administrative burdens;
  • favourable conditions for the self-employed in terms of tax and social security regimes.

In egalitarian welfare employment policies such as those seen in Scandinavian countries, policies seem to buffer the negative health effects of insecure forms of employment [32]. Scandinavian welfare states rely on employment protection policies that ensure effective collective bargaining institutions, lifelong job training, and generous unemployment schemes.

Conclusions

About 12% of all employees in Europe are temporary, and 15% of all working people are self-employed. These percentages are high, but also show that permanent contracts are still the standard. Employers ‘benefit’ from the many temporary contracts because they can easily manipulate personnel staffing in hard times [3]. The number of temporary contracts is falling, but there may be a serious underestimation of the incidence or temporary work because migrant and illegal work is not included in the discussion.

The figures on OSH problems related to flexible work indicate that the situation is somewhat worse – although not dramatically worse – compared to employees with a permanent contract. However, past research does show differences in health effects, where preventive measures and interventions can be successful. Offering more stability using egalitarian welfare employment policies and legislation models from these countries may be a way of buffering negative health effects.

References

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  13. DG Employment, Social affairs and Inclusion. Employment and Social Developments in Europe 2015. Chapter 1.1 Self-employment and entrepreneurship. Available at: [11]
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  28. Directive 89/391 - OSH "Framework Directive" of 12 June 1989 on the introduction of measures to encourage improvements in the safety and health of workers at work. Available at: [21]
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Links for further reading

Eurofound - European Foundation for the Improvement of Living and Working Conditions. Non-standard employment. Available at: [24]

Eurofound - European Foundation for the Improvement of Living and Working Conditions. Labour market change: Trends and policy approaches towards flexibilisation Available at: [25]

European Commission - Employment, Social Affairs & Inclusion, Working Conditions. Temporary agency workers. Available at: [26]

European Commission - Employment, Social Affairs & Inclusion, Supporting entrepreneurs and the self-employed. Available at: [27]

OECD - Organisation for Economic Co-operation and Development. Data on temporary work. Available at: [28]

ILO - International Labour Organisation. Temporary Agency Work. Available at: [29]

World Employment Confederation-Europe. [30]