Precarious temp agency work requires public policy attention

July 3, 2014

Imagine you just got a new job. But instead of a permanent job for an indefinite period of time, you are told that this near-minimum wage job will last four weeks, but could end at any point without notice, and the exact hours per week are to be determined. Your assignment might be extended, but maybe not, making it difficult to pursue other employment or to juggle family responsibilities. It’s unclear who your actual employer is—the firm supervising you, or the agency that sent you there. In fact, you’re not sure who is legally responsible for respecting your workplace rights. Although you do similar work, your colleagues receive higher wages and benefits. Would you want this job?

Yet this is typical of temporary agency work—a type of temporary employment that is often precarious and economically insecure. Although there has rightly been much focus of late on temporary foreign workers, very little attention has been paid to the realities of local temporary agency workers, despite the significant growth of this sector.

Recent years have seen a shift away from the standard employment relationship of permanent work, and towards a labour market increasingly characterized by non-standard employment. Temporary employment (including contract, seasonal, casual and temp agency work) is on the rise in British Columbia—accounting for 40% of post-recession job creation (2009-2013), and growing more rapidly than permanent jobs. But we should think twice about this type of job growth.

Temp agency workers—who are supplied by an employment agency to a third-party client—experience a high degree of precariousness because of the limited duration of employment, high risk of termination, lack of control over working conditions, unequal treatment under the law, and low incomes. Particularly alarming, existing employment standards are not enforced. According to my recent survey, as of April 2014 approximately two-thirds of Lower Mainland employment agencies were found to be unlicensed.

Put simply, this work is highly precarious and many temp workers live in poverty—in 2004, total yearly median earnings for temporary agency workers in Canada was $7,850, compared to $31,360 for permanent employees. But while poverty is a reality for many workers, the industry is booming in BC and across Canada. Operating revenues in BC increased from $355 million in 2004 to $675 million in 2012—surely they can afford to maintain minimum employment standards.

Although temp work is often defended as a “foot in the door”, workers tell of the challenges transitioning into full-time, permanent employment. This is not only due to a lacklustre job market; workers’ labour market mobility is constrained by “buy-out” clauses that require employers to pay a fee to agencies if they wish to hire temp workers directly. Employers should be encouraged—not penalized—when they want to directly hire workers and make investments in the labour force.

Luckily, BC can look to other jurisdictions that have successfully modernized legislation to improve economic security for vulnerable workers. The BC government needs to update the Employment Standards Act to address the realities of today’s labour market. Much of the current legislation was drafted when non-standard forms of employment were less common.

We should ensure equal treatment of temp agency workers, including pay, statutory and employer-sponsored benefits and working conditions—they should not be second-class workers. All workers in BC should be entitled to basic employment standards like notice of termination and severance pay. Employment agencies should provide greater clarity about length of assignments and working conditions, so temp workers are in a better position to advocate for their rights. Agencies need to be responsible for the costs of minimum employment standards, rather than downloading financial and time insecurities onto workers.

And importantly, temp workers’ rights should not solely exist on paper. Through active enforcement and regular inspections of temp agencies, the Employment Standards Branch must ensure that agencies are in compliance with labour legislation. And while the recent minimum wage increase is certainly a step in the right direction, it still is not enough to keep these workers out of poverty. Modernizing and properly enforcing employment standards, and further increasing the minimum wage will reduce the precarious nature of temp work.

It is time to address the realities of the labour market by implementing solutions that ensure greater fairness in the economy and deliver economic security in our communities.


Andrew Longhurst is author of a new report, Precarious: Temporary Agency Work in British Columbia. He conducted this research while serving as the Rosenbluth Intern in Policy Research at the BC office of the Canadian Centre for Policy Alternatives.