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An updated introduction to the ICEM CAL CAMPAIGN

An updated introduction to the ICEM CAL CAMPAIGN. April 2010. The issue of contract and agency work was established as a key priority for the ICEM at the ICEM’s World Congress in 2003

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An updated introduction to the ICEM CAL CAMPAIGN

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  1. An updated introduction to the ICEM CAL CAMPAIGN April 2010

  2. The issue of contract and agency work was established as a keypriority for the ICEM at the ICEM’s World Congress in 2003 • At the 2007ICEM World Congress in Bangkok, virtually all participants mentioned the continuous growth of the phenomenon - and talked about the problems that are the result of it. Time and again, reference was made to a clear need for continued action on this issue.

  3. Many different words exist to describe what essentially is a precarious “work relationship”. The “new ways of employment” do away with what used to be “standard”, meaning a permanent full-time job, directly employed by a single company, with a regular working week and benefits, and the protection, including against dismissal, that comes from a legal status as an employee. ICEM concentrates on contract and agency labour, but there are also other forms of precarious employment (informal work, simply badly paid jobs) What is CAL?

  4. What is CAL? Some of the ‘precarious job’ terms used

  5. Contract labour The word “contract” is used in two ways. First in the sense of temporary, short-term or part-time contracts (sometimes through an agency). Secondly, as in “contracting out”, which is when a company “contracts out” work to another employer. In some cases, this can also bean individual. The work may or may not be done at the same location. The new employer may take on none, some, or all of the staff members of the existing workforce. Whereas the first usually entails an employment relationship, the second usually brings about a commercial relationship. Agency labour Agency labour is where a company needs workers and, rather than employing them directly, asks an agency to send the required number of workers.

  6. Contracting out, slowly but surely, has become a problem for many, if not most, workers in the world, affecting workers everywhere, in different regions, different sectors and different lines of work. It spread from a relatively limited number of sectors - it always was a problem for migrants in the construction sector, for example - to all industries, affecting jobs that were considered “safe”. A leading example are the textile companies, who outsource everything, except “branding”. Inside the ICEM sectors, some sectors appear to be more concerned than others. The mining and diamond sectors, are dealing with huge numbers of contract workers. In the mining sector, there are countless examples where the contracted workforce outnumbers the permanent workforce. However, it also seriously affects the chemical, paper, materials or energy industries Who does it affect?

  7. CAL used to be a problem affecting only certain types of jobs : cleaning, catering, security, transport, maintenance or repair Later, others jobs were outsourced : sorting, packing, loading or unloading, engineering, warehousing and administration or clerical work Now, almost everything can be contracted out, including, for example, “core” production, extraction or sales jobs. The result: two categories of employees: coreworkers, who commonly receive relatively good employment conditions, on the one hand, and contract or agency workers, or workers in other precarious jobs, on the other, with the latter usually getting the inferior deal. Who does it affect?

  8. CAL is the resultof adeliberate employer’s decision to lastingly limit or reduce the permanent workforce. Arguments used to do this include the need to “maximise flexibility” (read: make it easier to dismiss workers from one day to the other) or the search for “cheaper alternatives” because of “market pressures”. The end result of the outsourcing effort commonly is a shift of the risk onto the workers, with jobs typically becoming non-permanent, or temporary, casual and insecure. Workers in these jobs are usually not (well) covered by labour law, nor by social security protections. Identifying the real employer, and establishing under whose responsibility such issues as working conditions and benefits fall, is a often a huge problem. A well-defined “work relationship” between an employer and an employee does often not exist. Main problems caused

  9. Among the main problems for CAL workers Job insecurity and an uncertain future. Uncertain working hours Low(er) wages, or irregular wages No annual pay rise or bonus, fewer benefits overall The right to sick leave often does not exist Limited or no access to social benefits, including pension rights health insurance maternity/paternity rights holiday rights and payments Increased risk to health and safety problems Poor, or no training - same for career development Lack - or denial - of rights at work, including the right to join, or form, a union and the right to collective bargaining

  10. Among the main problems for unions CAL is a threat for trade unions as the phenomenon is often simply misused as a tool to put pressure on workers not to join a union Many contractors/agencies to negotiate with Unclear which employer is responsible Permanent workers can be hostile to contract workers. Sometimes, 2 separate workforces are created with different interests. Contract and agency labour workers are legally, or practically, not allowed to join the union, or a union. Contract and agency workers don’t see an immediate value in joining the union Contract workers are scared of loosing their jobs Unions are losing members Collective bargaining is more difficult as there is less bargaining power

  11. Keeping workers on a series of consecutive short-term contracts - typically a few months (sometimes 3, sometimes 6, depending on what the law, or CBA, says) and have them re-apply time and time again (often a loophole in the law).(Thai Linde example: Dismiss workers after 17 months as they would get CBA benefits after 18 months) Or ask them to re-enter under another company name – or even under another name Creating fake agencies, catering to only one company Tricks and abuses

  12. Using “seasonal workers” in every season Ask CAL workers to sign blank resignation papers – no date filled in. In many countries, as agency or subcontracted workers are not regarded as employees of the user enterprise, CAL workers are often prevented to participate in strikes as this is considered illegal “secondary action”. The Polish Ministry of Labour estimated (in 2009) that half of agency workers do not have employment contracts, but, instead, service or commission contracts for a specific task or project (fake self-employed). In Serbia, Coca-Cola sells its trucks to its drivers, who become “self-employment” (no rights, no paid leave, no benefits, no…)

  13. In some cases, agencies themselvesare allowed by law to directlyemploy workers through a contract of unlimited duration. Even though the worker is “guaranteed” a permanent salary, this often leads to situations where there is no longer is any link between the salary of a worker and the salary of a comparable worker at the user-enterprise, opening the door for further misuse. In too many countries (e.g. South Africa), employers start hiring workers through agencies once “independent contracting” becomes illegal. Or they switch from using agencies to using subcontractors once that becomes regulated. In some countries or situations, it’s the other way around.

  14. “The new "Generation X" and "Generation Y" are no longer willing to commit to long-term employment in the hands of a single employer, and favour self-managed development plans and career paths that suit their individual aspirations.” “Permanent and especially unionized workforces tend to possess a "sheltered employment" syndrome, which reduces productivity and installs a "I just need to show up" mentality.” “More than 32% of these (temporary, part-time and contract) employees secured traditional, permanent jobs within 12 months - and 47% did so within 3 years”. Employers’ “views” Source: CAPES reaction to COSATU, South Africa, 2009

  15. “Agency workers are the first laid off when business turns bad”. “The flexible component of a company’s workforce thus serves as a buffer in times of crisis, softening the impact on permanent staff.” “Agency workers are the first hired when business recovers” “The agency work industry will be among the first to create jobs as soon as the economy recovers, as companies first hire agency workers to meet an increase in orders, before recruiting permanent staff when the situation stabilises.” Source: Ciett, 2010

  16. A few statisticsTemporary employment advanced economies – 1991 – 2006 (source: IILS - ILO)

  17. Temporary employment transition economies – 1998 – 2006 (source: IILS - ILO)

  18. From the 2010 annual report of Ciett(the International Confederation of Private Employment Agencies) Across the world, 9.5 million agency workers (full-time equivalent) were employed daily in 2007 (up from 8.9 million in 2006). This decreased by 1% in 2008.31% of them are in the USA. The number of agency workers has more than doubled from 1997 to 2007. (Ireland x 8.75, Japan and Sweden x 4, Germany, Switzerland, Finland, Denmark and Norway x 3) The averageEuropean agency work penetration was 1.7% in 2008, down from 2% in 2007. (“notably due to the early impact of the economic crisis on the UK”) In Japan, this figure still grew (from 2.1% to 2.2%)

  19. “The global annual turnover of the Private Employment Agency industry amounted to € 232 billion in 2008” Source: Ciett 2010 - “The agency work industry around the world”

  20. Europe is the largest in terms of Ciett affiliates’ income (48% of worldwide revenues in 2008), followed by USA (21%) and Japan 21%) Source: Ciett 2010 - “The agency work industry around the world”

  21. Source: Ciett 2010 - “The agency work industry around the world”

  22. Source: Ciett 2010 - “The agency work industry around the world”

  23. Large firms play an important role in the TAW (Temporary Agency Work) sector. However, their dominance of national markets varies a great deal between countries. Large firms are generally important in the European countries, in particular those with the most extensive use of agency work. In 2005, the largest “concentrated markets” were France (83% of industry turnover by the largest5 companies), Belgium (74%), the Netherlands (69%) and Spain (59%). TAW

  24. Adecco is the world's largest private employment agency, serving over 140,000 clients (down from 150,000 clients in 2007) in over 60 countries in 2009. It is currently employing an internal staff of 28,000. The company says its “daily number of staff on assignment” is over 500,000,with over 100,000 clients every day . Over 90% of its sales comes through providing temporary staffing. Manpower used to be the world's second-largest provider of temporary employees. It states it places 4 million people yearly in permanent, temporary and contract positions through officesin 82 countries. It claims it has 400,000 “associates” on assignment on any given day. The previously third largest employment agency, Vedior,was bought in 2008 byNo. 4, Randstad, making Randstad currentlythe globalNo. 2,operating in more than 50 countries, employing 465,000 people every day in 2009.

  25. According to FNV Netherlands, there were not only around 100,000 agency workers sent out daily in 2009 by reasonably well-behaving bonafide agencies, there is also an equal 100,000 sent out through (much) smaller, less credible agencies. 51% of Belgian agency workers works with day contracts. 22.4% of all Belgian job openings go to agency workers. 8% of the remaining 75% are ex-agency workers andan additional 19% gets a temporary contract. That means that only 49% gets a contract of unlimited duration when hired.

  26. In Japan, 70% of non-regular workers are women. In Thailand, 80% of all contract workers are women. In Korea, 67.7% of women workers are non-regular (versus 32.3 % for men). The average wage of a female non-regular worker in 2008 was 67% of a typical male worker. In Australia, 1 in 3 women was casually employed in 2008,paid 21% less than permanent workers. According to Ciett, in 2009, more than 3 in 5 agency workers were aged less than 30. Gender - Youth

  27. Gender Differences for agency workers Source: Ciett 2010 - “The agency work industry around the world”

  28. In Europe, an estimated average of 4 to 5 % of workers are working as contract, temporary or agency workers, varying from rather low percentages in the Nordic countries to 33% in Spain (of which “only” 16% is agency work). European differences: in the UK, some 70% of temporary work is in the service and public sectors. In France, 75 % is in the construction and the manufacturing sectors. Temporary workers in the EU are mostly men. However, in some Nordic European countries, they are predominantly female. Statistics - Europe From: European Foundation for the improvement of living and working conditions, 2007

  29. Another difference is in the percentage of young/old agency workers, from around 80% under 26 years in Poland, to almost 25% between 45 to 60 in Denmark…. …or in the duration of assignments, from short (an average of 1.9 weeks in France) to much longer… 63% of all Belgianagency workers in the private sector has been working as an agency worker for over 1 year, close to 40% for over 3 years. (ABVV sources, 2009) From: “Temporary agency work and collective bargaining in the EU” (Dec. 2008)

  30. Source: Ciett 2010 - “The agency work industry around the world”

  31. TAW employment and revenuesA few European examples Source: European Institute for the Improvement of Living Conditions, Dec. 2008

  32. Inconsistent and often limited figures In the UK, the figure for agency workers varies from 1.4 million (employer’s organisation) to 270,000. (Labour Force survey, 2008) In the Czech Republic, “agencies are obliged to report data annually to the Ministry, or attract a fine”. However, “only a third of all agencies complies”. The requirement is not enforced partly because the Ministry cannot cope with current levels of data given the large number of agencies now operating.” From: “Temporary agency work and collective bargaining in the EU” (Dec. 2008)

  33. Trade union density for agency workers differs widely, also inside Europe. It ranges from Denmark (50%) and Finland (44%), over Netherlands (17%), Austria (5%) or Germany (4.3%) to Italy (1.7%), France (0.9%) and Slovenia (0.18%). In Sweden, a difference is noted between white-collar (17%) and blue-collar (50%), the latter figure “might reflect higher exposure to trade unions in the user companies.” Statistics - Europe From: “Temporary agency work and collective bargaining in the EU” (Dec. 2008)

  34. An August 2009 IG Metall + University (Germany) survey finds that agency labour is increasingly being used more strategically by enterprises as a way of passing on the business risk of the cost of longer-term employment. In 2008, in Germany, 66% of all employed people had a regular job (secure jobs with social benefits and at least 20 hours a week). In 1998, that was 72.6%. The German Statistics Institute said in 2010 that more and more workers have a fixed-term contract while they would prefer a permanent one.In 2008, 8.9% of employees had a fixed-term contract, up from 5,7% in 1991.For new recruits, this figure reached 47%.

  35. In Germany, the “Hartz reforms” included the creation of ‘mini’ and ‘midi-jobs’ which are typically low quality part-time jobs and established small grants for entrepreneurs to build a group of self-employed workers. This category of self-employed workers came to be known as ‘Ich AG’, or ‘Me inc.’. The percentage of part-time workers in Germany rose from 14 to 22.8% between 1991 and 2004. Similar to experiences in other countries, this employment status is made up of 86% women. Source: “Moving from precarious work to Decent work”, TUAC, 2009

  36. In Croatia, “almost 90% of new recruitment is for a fixed term, which prevents many people who are newly entering employment or changing jobs to join a trade union”. In many Central European and Balkans countries, “the legal exclusion of certain larger groups of persons ” (often including contract workers, e.g. Poland ) “from trade union membership” is identified “as a considerable problem” and something which is “no longer compatible with the principle of freedom of association”. Source: FES, 2009

  37. In the Peruvian mining sector, only 16,000 workers were permanent workers in 2008, out of a total of over 85,000. In the early 90’s, 95% were still listed by ministerial figures as direct permanent workers. In ColombianEcopetrol, there were 13,850permanent workers in 1975, vs. 230 temporary and 500subcontracted workers. In 2008: 4,500permanent workers, 600 temporary and 16,000subcontracted. Statistics – Latin America

  38. Colombian ICEM affiliate Sintraelecol put the number of CAL workers in its sector at 70%. In Endesa, there was 1 permanent directly employed worker for every 6 non-permanent one (2008). With Smurfit Kappa in Colombia (paper company, 2.700 workers), 60% of all workers were said to be CAL workers in 2009. Carbones de Cerrejon in Colombia, the world largest open-pit coal mine, employs around 5,300 workers. 6,000 otherworkers are employed at the mine by subcontractors.

  39. A questionnaire by the ICEM Brazil social dialogue project in 2008 to unions in 15 major Brazilian companies in different ICEM sectors on “what is the main target we should deal with” lists the issue of “subcontracting” (100% of all respondents mentioned it as a priority) as the number 1 priority to deal with, before “Corporate Social Responsibility” and “Sustainable development”.

  40. Permanent vs. CAL workers in the Brazilian Chemical sector Source: ICEM co-sponsored research – Brazil chemical sector, Nov. 2009

  41. Informal employment in Latin American countries 1998 – 2006 Informal employment in the formal sector includes those workers who do not have a proper contract (source: IILS - ILO)

  42. Part-time, contract, and temporary work as well as self-employment, now corresponds to 1/3 of the Canadian workforce nationally. (TUAC Document 2009 - 2008 figures) Almost 70% of the self-employed group can be considered ‘disguised’ employment. (TUAC Document 2009 – 2004 figures) The US Government Accountability Office has reported that the number of ‘contingent’ workers who are independent contractors, temporary workers, subcontracted and leased workers and part-time workers stood at approximately 31% of the total workforce. (2006) Statistics – North America

  43. A 2007 Mexican study found that approximately 60% of the 400,000 workers in Mexico’s electronics industry work for temporary agencies, with some companies employing as much as 90% of their workforce through sub-contractors. (source: Cereal) Using official Mexican census sources, a 2009 study reported that fully 10 % of the Mexico’s workforce was employed by temporary agencies. (Source: Center for Labor Research and Union Advisement )

  44. In Korea, 55% of the labour market is organised through agency, contract or temporary work. On average, Korean non-regular workers worked the same amount of hours as their permanent directly employed counterparts in 2008 (an average of 46.6 hours per week). Unfortunately, again on average, they earned only 51,9% of the Korean permanent workers’ salary. Coal India Limited employs some 420,000 permanent and 200,000 contract workers (2009 figures). Statistics – Asia/Pacific

  45. In Singapore, the number of contract and casual workers increased by over 300 % from 2001 to 2007. In the Indian province of Goa, 80% of all workers are said to be contract labourers in 2009. In its Pakistan Khanewal Lipton Tea factory, Unilever employed, until late 2009, 22 permanent employees and 723 agency workers. The non-permanent workers earned 1/3 of the salary of the permanent workers (if they managed to work the whole month).

  46. In Japan. the “category” of CAL workers only came into existence 20 years ago. Their number rose to 17 millionin 2004 - over 33% of the labour workforce - up from 20 % in 1990. The rate of short-time workers in employee pension insurance in Japan in 2008 was 30% (It was 80% for regular workers). In Australia, in the early 1990s, around 23% of the workforce was “casual”. In 2008, that already was 27%.

  47. Statistics – ICEM Asia MNC Project - 2009

  48. Trade union density for CAL workers is low In Japan, 4.4% of non-regular employees are trade union members (2008) In Korea, 3 % of atypical workers belong to unions. (2008) In Australia, 9.4% of casual workers are union members, versus 30.1% for permanent employees. (2009)

  49. A 2008 South African Labour Department study highlights the alarming increase of subcontracted labour in the South African mining sector, mainly using workers from foreign countries such as Mozambique and Lesotho, often in an effort to avoid direct accountability in cases of accidents and death. Over 60% of all staff of South African utility company Eskom was temporary in 2008. “Employment informality” within the formal mining sector increased from 90,231 jobs in 2003 to 122,589 in 2005, with subcontracted workers commonly being forced to work under dangerous conditions without protective clothing. Statistics - Africa

  50. According to the study, “It is necessary to re-conceptualise the informal economy from its origins 3 decades ago as a description of the urban poor in developing countries, to a recognition that informality does not exist in small, unregistered enterprises, but is increasingly found inside formal enterprises through the rapid growth of casual and subcontracted work”. It was estimated in 2009 that around 500,000 workers in South Africa are employed by labour brokers. According to the NUM, labour brokers in South Africa usually take as much as 50% - in some cases up to 70% - of what the company pays to the labour broker as their “fee”.

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