first Collective Labour Agreement for Temporary Agency Workers in 1972.
Regulation and legislation progressed and a new reference point was reached in
...
Temporary agency work works! The economic and social role of temporary agency work in the Netherlands 1
Temporary agency work works!
Introduction
3
1.
The temporary agency sector as the largest employer
2.
Temporary agency work offers opportunities for everyone
7
3.
Temporary agency work as a decent form of flex work
9
4.
Public-private collaboration between the government and the temporary agency sector on the labour market
11
5.
Social security
13
14
6. Training
17
7.
Tackling mala fide temporary employment agencies
18
8.
Labour migrants
22
9. Conclusion Sources
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2
PERMANENT/ flex 1996
FLEX FORMS AS % OF THE WORKING POPULATION Source: Statistics Netherlands
penetration rate of flexible contracts 1996
1996
24,9% Flex
penetration rate of flexible contracts 2011
1996
75,1%
Permanent
PERMANENT/ flex 2011
3,1%
5,4%
3,1%
4,7%
2,3% 2,5%
6,4%
2,7%
2011
3,3%
9,8%
29,6% Flex
2011
70,4%
5,7%
2,6%
Permanent
1,6%
1,3%
Introduction This publication, Temporary Agency Work Works! from the Dutch Federation of Private Employment Agencies (Algemene Bond Uitzendondernemingen, abu), gives an idea of the Dutch temporary agency work sector. How is the sector doing, what is the economic and social importance of this sector and what are the challenges?
F
or more than 50 years, abu has been representing the interests of private employment agencies in the Netherlands. The trade association has gone through all phases of temporary employment. The pioneer phase when temporary employment was developing and the sector was growing; the phase when placement actually began to regulate itself more and presented the first Collective Labour Agreement for Temporary Agency Workers in 1972. Regulation and legislation progressed and a new reference point was reached in 1999: the Dutch Flexibility and Security Act (Wet Flexibiliteit en zekerheid or Flexwet). The temporary employment licence had already been abolished in the year prior to this. Development Since then, the sector has continued to strengthen itself by policy development and institutionalisation of training (Stichting Opleiding & Ontwikkeling Flexbranche, stoof), occupational health and safety (Stichting Arbo Flexbranche, staf) and monitoring compliance with the collective labour agreement (Stichting Naleving cao voor Uitzendkrachten, sncu). Besides the Collective Labour Agreement for Temporary Agency Workers, a Social Fund for the Temporary Agency
penetration rate of flexible contracts 1996/2011 % Self-employed persons with staff/employees
Work Sector Collective Labour Agreement (cao sfu) came about regulating that all temporary employment organisations have to pay a fixed percentage for stoof, staf and sncu. In addition, the public-private collaboration and selfregulation are being used more and more to combat mala fide practices (Labour Standards Association, sncu, Labour Inspectorate, Tax Authorities, etc.) and are being used in public-private partnerships in job placement services (Employee Insurance Agency, municipalities). These are all developments with which the temporary agency work sector has proved and continues to prove its economic and social significance in the interest of a healthy labour market. Lasting flexibility Placement has grown into the example of well-regulated flexibility with two clear functions on the labour market: 1. Providing flexibility to labour organisations and 2. offering allocation. A new phase lies in the consolidation and continuing investment in temporary employment agency work as lasting flexibility. This durability must be safeguarded by a good balance of flexibility, responsible cla provisions with ample opportunities for temporary agency workers to train and develop themselves, and law and regulations that take the role of temporary employment agency work into account: the allocative function through which many hundreds of thousands of job seekers find their way to the labour market.
% Self-employed persons without staff % Temporary contract > 1 year % Temporary contract with a prospect to a permanent contract % On-call worker % Temporary agency worker % Other flexible contracts
The temporary agency work sector is crucially important to the Dutch labour market and it would like to constitute a greater percentage of the flexibility on that labour market. This means the business sector remains competitive and even more people have a new chance of work. People of all ages and backgrounds, and with all levels of education – lower, secondary and higher - because temporary agency work… works!
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1
The employment agency sector as the largest employer More than 750,000 people get to work via a private employment agency each year. Each day some 172,000 temporary agency workers are at work. This makes the sector the largest employer in the Netherlands and we cannot imagine the Dutch labour market without it. On the other hand, even with these large numbers the temporary agency work sector only makes up 2.3% of the total working population and not even 10% of the flexible employment places. Bad and cheaper forms of flexibility often take the place of placement properly regulated by law and cla.
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TURNOVER TEMPORARY AGENCY SECTOR 2011
€ 11,4 BILLION
Source: Statistics Netherlands
PLACEMENTS BY private EMPLOYMENT AGENCIES 2011
1.4 MILLION
Source: ecorys
NUMBER OF TEMPORARY AGENCY WORKERS 2011
752.533 Source: its
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he Netherlands has a strong economy. Even in these times of economic downturn, our economy is still doing relatively good. The Netherlands is one of the countries in Europe with the lowest unemployment figures and the reason that the country was able to get through the crisis relatively well is also thanks to the flexibility on the labour market. This ensures that companies are flexible enough to move with the economy and above all to remain competitive. In the future, the need for flexibility will increase rather than decrease. If at any time the economy shows a moderate growth again, entrepreneurs will want to continue organising part of their company flexibly. It is necessary to regulate this flexibility in a proper and socially responsible manner. Allocation The temporary agency sector ensures that people can transition to other work, possibly with an educational process to increase their opportunities. Like no one else, the temporary agency sector knows how to match demand and offer on the labour market. This so-called “allocation function” of temporary agency work therefore has an important economic extra value.
Permanent and flex The temporary agency sector has a robust new cla with the Collective Labour Agreement for Temporary Agency Workers that entered into force in 2012. This is seen as a breakthrough. This cla acknowledges the major economic and social importance of temporary agency work. Agreements on equal pay for temporary agency workers and permanent employees bring “flex” and “permanent” closer together. Placement as lasting flexibility for a lasting economy: this fits perfectly with the social trend. Employees are opting less and less frequently for a nine to five job but want to be able to organise work and private life flexibly. With the conclusion of the CLA, the trade unions have sided with temporary employment as the preferred form of external flexibility. The government is increasingly seeking collaboration with the temporary agency work sector to assist people in finding work. Where municipalities and the Employee Insurance Agency have to take a step back due to cuts, the temporary agency work sector is jumping in with its expertise. The public-private collaboration can only become closer in coming years and this will benefit everyone.
Step towards work In addition, temporary employment organisations provide the step towards work for people who are finding it difficult to get work, such as people with a limitation, young people with no starting qualifications, the elderly or people who have been unemployed for a long time. This is also evidenced by the figures: more than a third of all people claiming unemployment benefit who found a job were able to do so via a private employment agency.
TEMPORARY AGENCY WORKERS PER DAY 2011
172,000
Source: Statistics Netherlands Explanation: The annual figure is a flow figure. This means that it is measured over a period, in this case the year 2011. The figure from Statistics Netherlands is a daily average figure. This means that it is measured at a certain time (for example on 1 January of a year). Additionally, Statistics Netherlands does not publish figures for jobs less than 12 hours a week. Therefore, the daily figures are an underestimate of the reality.
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2
Temporary agency work offers opportunities for everyone The temporary agency work sector is by far the most important way to find work. Almost three quarters of those finding work in this way still have a job one year on. Moreover, 52% have gone on to a permanent employment contract.
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LEVEL OF EDUCATION Source: its
Lower educated (no starting qualification) Medium educated Higher educated
35 % 46 % 19 %
TOP FIVE REASONS FOR Agency WORK Source: Ecorys
a permanent 28% Seeking job through temporary agency work
18% Gaining work experience
16% Holiday job
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here are opportunities for everyone. For people higher up the employment ladder, for skilled workers with proper senior secondary vocational education, for students but also for those who are not as highly educated and people who are finding it difficult to get work: people with a handicap, immigrants, those on benefits and young people without starting qualifications (35% of all temporary agency workers do not have a starting qualification (its, 2012)). The success factor is the low threshold nature of temporary agency work. Via the temporary agency work sector employers dare to give people a chance and that is often a success.
Helping the elderly back to work and keeping them there is another important social challenge. Because of the growing number of elderly people and the increase of the pension age to 67 this problem is only becoming more pressing. For this group, temporary agency work is often the only way back to work. The percentage of the elderly intermediated through a private employment agency has risen sizeably in recent years: from 13% to 20% (45+). Annually this is about 150,000 people (20% of 750,000). All in all, the temporary agency work sector is the ultimate matchmaker because this sector knows exactly what opportunities the labour market is offering. In addition, extra training is often arranged in view of the fact that this increases the chances of temporary agency workers and makes them employable for a longer period.
AGE
Source: its
> 45 years old 20%
7
< 25 years old 33%
35-44 years old 18% 25-34 years old 29%
Employment position after agency work Source: its
permanent contract 19%
15% Temporary/ additional work
job 15% Additional next to study
next agency contract 25%
temporary contract 33%
3
Temporary agency work as a decent form of flex work It has been argued that flexibility in the Netherlands has gone too far. However, this argument is only partly true. The Netherlands has a huge variety of agency workers. These are not only temporary agency workers but also self-employed persons, temporary agency workers, on call and stand-in employees and people with a zero-hour contract.
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THE LAW AND THE TEMPORARY AGENCY COLLECTIVE LABOUR AGREEMENT THE LAW WEEKS
26 WEEKS
1 YEAR
Placement 26 worked weeks
1,5 YEAR
2 YEAR
2,5 YEAR
3 YEAR
Period and chain system Maximum 3 contracts in 36 months
3,5 YEAR
Open-ended contract
THE TEMPORARY AGENCY COLLECTIVE LABOUR AGREEMENT WEEKS
26 WEEKS
1 YEAR
PHASE A 78 worked weeks agency clause
1,5 YEAR
2 YEAR
2,5 YEAR
3 YEAR
PHASE B Maximum 8 fixed term contracts Maximum 2 years
3,5 YEAR
PHASE C Open-ended contract
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he group of agency workers is growing but the number of temporary agency workers has dropped in fifteen years from 3.1 to 2.3% of the working population. It is important to distinguish between temporary agency work and other forms of flexible work. Temporary agency workers have an excellent legal position, also due to the 1999 Flex Act and temporary agency work, certainly with the conclusion of the new fiveyear cla, is the best and most regulated type of flex work. The Dutch Flexibility and Security Act was enacted at the time to offer employees more certainty as and when the employment relationship lasts longer. At the same time, the increased flexibility for private employment agencies has been limited. In the abu cla, this is worked out in the phase system which temporary agency workers go through from temporary employment contracts (phase A) to fixed term contracts (phase B) to open-ended contracts (phase C). Approximately 25% of the hours that the temporary agency workers work are in the last two phases. The average temporary employment duration has also become considerably longer since the implementation of the Flex Act. Temporary employment does what the Flex Act intended: it offers more certainty through more permanent and longer contracts.
distinctive position for placement on the flexible labour market – lasting flexibility for a lasting economy. Other flexibility The abu is not opposed to other forms of flexibility as long as they provide the same extent of employee protection as placement. The abu is an outspoken opponent of bad flex forms such as on call and zero-hour contracts, too many consecutive fixed term contracts and fake self-employed persons’ constructions or self-employed persons who are forced to work for minimum rates. In 1999 when the Flex Act was created, the point of departure was that forms of unregulated flex would disappear. The abu still supports this. Obviously, the abu is also completely opposed to any kind of mala fide practices, whether this concerns intermediaries who look for loopholes in the law or elude the law with undesirable employment constructions. These constructions not only disadvantage employees but also employers who do want to uphold the law: they are confronted with unfair competition. PROPOSAL The abu continues to work towards a strong position for temporary agency work in the interest of private employment organisations and temporary agency workers
Equal pay The new Collective Labour Agreement for Temporary Agency Workers, which entered into force in 2012 for five years, underlines the solid position of temporary employment. The cla brings “flex” and “permanent” closer to one another with agreements on equal pay for temporary agency workers and permanent employees. In the agreement made by the abu with the unions it was also agreed that the parties would work towards a continuous strong and
and therefore in the interest of our labour market. The abu is asking the government for a discouragement policy with regard to badly regulated flexible work forms. The abu agrees with the trade unions that advocate that flexible work should only be possible under preconditions laid down by law, offering the employee protection and clarity. Decent forms of flexibility must be given the opportunity to increase the Netherlands’ economic power.
NUMBER OF AGENCY WORKERS WORKING DAILY 2.200 2.000 1.800
349.000
1.600 728.000
1.200
20 11
20 09
20 08
20 07
20 06
20 05
172.000
20 04
191.000
20 03
187.00
20 02
0
165.000
20 01
200
419.000
20 00
400
189.000 103.000 167.000
199 9
600
246.000 96.000
199 8
800
397.000
199 7
1.000
% Self-employed persons with staff/employees % Self-employed persons without staff
331.000
20 10
1.400
199 6
x 1.000
Source: Statistics Netherlands
% Other flexible % Temporary contract > 1 year % Temporary contract with a prospect to a permanent contract % On-call worker % Temporary agency worker
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4
Public-private collaboration between government and temporary agency work sector on the labour market We live in times of decentralisation and cuts. Tasks are shifting from the national government to local authorities. At the same time, budgets for reintegration projects of municipalities and the Employee Insurance Agency are shrinking, for example. Therefore, private parties are being looked for increasingly more to take over more tasks. There are still plenty of job opportunities as is apparent from research (Astri 2012), particularly in sectors where there is low-skilled work.
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OUTFLOW FROM UNEMPLOYMENT BENEFITS Source: rwi
35% claiming benefit under the Unemployment Insurance Act
39% claiming benefit under the Work and Social Assistance Act
BACK TO WORK VIA THE private EMPLOYMENT AGENCY (INFLow)
74% sustain working
68% sustain working
Explanation: More than a third of the job finders who claimed benefit under the Unemployment Insurance Act found work again with the help of a private employment agency. Agency work is the stepping stone for even more people on social assistance benefits who find a job (39%).
I
n a number of municipalities the temporary agency work sector proves to be the ideal partner to get people on benefits back to work. Various municipalities have already helped hundreds of people back to work by partnering with the temporary agency work sector. The municipality, often with the help of a private employment organisation, arranges for preselection of candidates and the private employment agency matches the candidate and the vacancy.
The temporary agency work sector likes working with the government. To make even more collaboration projects possible it is important that measures, amongst others in the area of social security, do have a price reducing effect. This will stimulate the accession of target groups to the labour market.
PROPOSAL More and more people are getting back to work through
Work Plazas The collaboration with the Employee Insurance Agency is also very productive. Speed dating sessions are held where job seekers can get to know various private employment organisations. This takes place all over the Netherlands at the so-called Work Plazas. In 2012, an official agreement was signed with the Employee Insurance Agency to this end. Besides embedding the existing activities, the abu and Employee Insurance Agency have made agreements on new activities. These are focused mainly on specific target groups such as young people on disability benefits, the elderly and people with a distance to the labour market. Exchanging data “New” job seekers must currently be registered with a private employment agency in order to be entitled to unemployment benefit. Moreover, matches can be made more rapidly by enabling better exchange of data between the government body and the private employment agency. A proactive attitude is essential because the longer someone is unemployed the harder it is to place them.
ETHNICITY Source: its
Immigrants 35 % Natives 65 %
the collaboration between the temporary agency work sector and authorities. The ABU would like to do more to further expand this collaboration and help throughout the country to achieve as great a degree of employment participation as possible. The ABU is asking the national government to stimulate the public-private collaboration for job placement services by condition-creating policy, so that temporary agency work remains an attractive formula on the labour market. Specifically, this means eliminating barriers of regulations (Participation Act) and improved access and clarity for databases of potential employees.
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5
Social security The set-up of social security with regard to temporary agency work requires a good balance in its funding and affordability, taking into account the important allocative function of the temporary agency work sector.
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THE BIGGEST MISUNDERSTANDINGS ON EMPLOYMENT CONDITIONS FOR TEMPORARY AGENCY WORKERS
1
2
3
The new cla that entered into force in 2012 regulates that temporary agency workers earn the same as employees with permanent contracts at the company where the temporary agency worker is hired. This takes effect in 2015 but in nearly all cases “equal pay for equal work” is already being applied.
Phase A temporary agency workers receive 70% of the daily benefit for illness from the Employee Insurance Agency. This is supplemented to 91% in the first year and 80% in the second year of illness if the private employment agency uses the abu cla. If the agency clause applies, then the temporary agency worker has two waiting days.
A temporary agency worker works an average of 28 hours per week. The national average of a Dutch employee is 30.6 hours per week. Small jobs are jobs of less than 12 hours per week. The average placement term for a temporary agency worker is 25 weeks.
Temporary agency workers always earn less than the employees employed by the company where the temporary agency worker works.
Temporary agency workers do not receive a salary and are not insured for illness and occupational disability.
Temporary jobs are always small and temporary.
I
n principle, the abu is in favour of a social security system that offers employers and employees incentives, leads to a reduced number of people starting to claim unemployment benefit, sick benefits and partial disablement benefits, and increases outflow. The best system has an activating effect and is rewarding for both employers, employees and intermediaries because of quick work recommencement.
Sector contribution Contribution differentiation in itself is a usable instrument but not if it leads to unreasonably high contributions whilst the private employment agency has few opportunities to affect the inflow. Moreover, it is still by no means certain whether the temporary agency work sector is seen as the cause or as the solution. With the “polluter pays” principle the temporary agency work sector is often dealt with unnecessarily harshly with regard to social security. The relatively very high sector contribution for private employment agencies leads to skewed situations, as the contribution makes the temporary agency work sector more expensive than the hiring sectors (where lower contributions apply) whereas the cyclical problems for these sectors are resolved. This situation therefore is most detrimental to the flexibility and functioning of the labour market. The contributions cause price increases, as a result of which the allocation role of the temporary agency work sector is compromised. This also leads to the risk that hiring employers flee to less well regulated and cheaper flexible work forms. Therefore the abu advocates an average sector contri-
bution, which applies to the temporary agency work sector instead of an unreasonably high own sector contribution, as applies now for the temporary agency work sector. The temporary agency work sector annually intermediates around 230,000 “target groupers”: long-term unemployed, the elderly, immigrants and occupationally disabled people. Temporary work offers extra value due to its low threshold and the absence of selection at the door. The way in which the social security is organised (with the accompanying contribution pressure) should not lead to selection at the door becoming inevitable. This would mean that the temporary agency work sector also loses an important part of its allocative role and extra value for the labour market. PROPOSAL The abu is in favour of a social security system that is set up such that its activating effect is as great as possible. What is more, the temporary agency work sector itself fulfils an important role in the return and accession to the labour market. In return, the abu is asking the national government for social security legislation that takes the nature and function of agency work into account. The abu is advocating an average sector contribution, which would be applicable to the temporary agency work sector instead of an unreasonably high own sector premium, as applies now for the temporary agency work sector. The abu also advocates equality between “permanent” and “flex” where the access to social security is concerned.
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5
6
Research shows (its, 2012) that of the temporary agency workers who have done agency work for more than two years (phases A or B) (114,700) only 8% (9,400) also had benefit periods in that time.
Temporary agency workers accrue pension via the stipp pension scheme. If an agency worker is aged 21 or older and does not have a permanent contract he accrues pension via the Basic scheme. The condition is that the employee works at least 26 weeks via one private employment agency (possibly spread over a year). A Plus scheme applies for phases B and C.
15.8% of all agency workers receive training. This is almost as many as the group of employees directly employed by employers. 16.4% of them receive training.
Many temporary agency workers remain trapped in temporary agency jobs alternated with benefit periods.
Temporary agency workers do not accrue pension.
Temporary agency workers do not receive training.
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6
Training More and more agency workers are being given training. Almost 16% follows a course via a flex organisation. This is considerably more than the 10% of people working via temporary contracts and almost as many as employees in permanent employment (16.4%).
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EDUCATION Source: stoof
15, 8 % of all temporary agency workers, 16,4 % of all people with a permanent employment contract, 10 % of all people with a temporary employment contract in direct employment are undergoing training
EDUCATION FROM A HISTORICAL PERSPECTIVE
Source: stoof
15,0 10,0 5,0 0,0 2001
2002
2003 2004 2005 2006 2007 2008 2009
% temporary agency workers % permanent employment % temporary employment directly employed
2010
T
raining opportunities increase the chance
of acceding to the labour market and lasting employability. Education is much needed, certainly in these economically uncertain times. Well-maintained knowledge and competence are the best guarantees for lasting participation on the labour market. That is important, precisely for those with a flexible employment contract. User companies benefit from well-qualified agency workers who are easily employable. For private employment agencies good qualifications are added value and the agency workers themselves have more security for potential long-term work. Extra attention must be given to the fringe of the labour market. 35% of agency workers do not have a starting qualification. Education for this group is lagging behind.
The abu believes that educational facilities must be available irrespective of the nature of the contract. We must work towards an individual educational right and budget where employees, permanent and flexible, can use all training funds intersectorally. More flexibility in the access to the regular vocational education for agency workers improves training opportunities. Collaboration of the educational and development funds (o&o funds) in the temporary agency work sector (stoof) and other sectoral o&o funds increases the educational opportunities and the intersectoral mobility of agency workers. PROPOSAL Agency workers are equal to employees in permanent employment where following courses is concerned. Private employment organisations continue to invest in courses
Employment security We are moving towards a labour market where everyone is much needed and the need for well-trained and qualified staff is only growing. Work is becoming more knowledgeintensive, knowledge becomes obsolete faster than ever and positions are continually changing. The time when an employee stayed with an employer for their whole life is slowly but surely no more. More and more people are moving from one job to another. Good training and education enhance the individual opportunities for work and encourage the transition from work to work. Job security is making way for employment security.
for temporary agency workers, certainly in view of the future tight labour market where knowledge and skills are becoming increasingly important. The fringe of the labour market deserves extra attention. Education is a responsibility of the private employment agencies, agency worker, user company and government. The abu is asking the government for legislation and support of financial measures (including via the Dutch Salaries Tax and National Insurance Contributions (Reduced Remittances) Act)) that are better equipped towards the fact that learning and flexible work are taking place more often via the temporary agency work sector. This means more educational facilities, which are better coordinated towards the temporary agency formula.
INTERSECTORAL MOBILITY
Source: employee insurance agency
The temporary agency work sector is involved in 42% of all transitional movements from a job from one sector to another sector via a brief period of unemployment.
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7
Tackling mala fide employment agencies Unfortunately, there are still mala fide companies in the temporary agency work sector that bend the rules and exploit people or underpay them and create unfair competition. That such wrongdoing occurs is extremely damaging to the temporary agency work sector and the labour market in its entirety in abu’s opinion. Temporary agency workers are entitled to honest work for fair pay. Mala fide situations are a blot on the entire temporary agency work sector, which for the greater part consists of decent companies. Just as the government, the temporary agency work sector sees it as an important priority to rule out
16
mala fide practices.
1
Member of the Federation of Private Employment Agencies (abu) 480 members: 65% of the private employment agency industry
2
sna-certified 3,160
3
Registered as private employment agency at the Chamber of Commerce 19,000 (estimate szw)
CHECKED FOR: Correct application of the cla for Temporary Agency Workers Accommodation standards in the CLA In possession of SNA certificate Chamber of Commerce Registration
CHECKED FOR: Statutory minimum wage and minimum holiday allowance Payment of payroll tax Payment of social security contributions Foreign Nationals (Employment) Act
RISKS: Additional tax settlement of payroll tax and social insurance Additional settlement of statutory minimum wage Fine for illegal work
Non-registered temporary agencies (number not known) RISKS: Illegal temporary agency Fine for private employment agency and user company EUR 12,000 per temporary agency worker Additional tax settlement of payroll tax and social insurance Additional settlement of statutory minimum wage Fine for illegal work
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he point of departure is a public-private system in which self-regulation and government regulation reinforce one another. By registration and certification the sector distinguishes between good entrepreneurs and bad ones. Public and private enforcers ensure tracking down and coming down hard on mala fide private employment agencies. There is a lot of support for this kind of collaboration within the temporary agency work sector despite the private regulation pressure that would be involved. The abu sees the public-private approach as much more effective than the temporary employment license, which leaves the enforcing government standing alone. sna-certificate Since 2007, the temporary agency work sector has a highquality nationwide certificate for all private employment agencies that comply with a number of strict standards: the sna certificate (Labour Standards Association). This concerns standards in the area of minimum wage payment and payments of payroll and turnover tax. Meanwhile 3,000 private employment organisations hold the sna certificate. This separates the chaff from the wheat. In addition, there is the special cla police sncu (Stichting Naleving cao voor Uitzendkrachten (Foundation for Compliance with the Collective Agreement for Temporary Agency Workers) supervising private employment agencies.
Natural persons All in all, it is becoming more difficult for mala fide entrepreneurs to remain out of sight. The approach will increasingly focus on a relatively limited number of natural persons who hide behind the hundreds of legal entities (bvs) active on the market. Besides the mala fide private employment agencies, there are all kinds of forms of flexibility that cannot bear the light of day and where the working man is poorly protected. They are conquering more and more market share by providing labour below the market rate. Forceful enforcement by the government, where possible supported by the private sector, could turn the tide.
PROPOSAL The temporary agency work sector takes its full responsibility in the public-private tackling of mala fide private employment agencies, in which government regulation and self-regulation of the sector reinforce one another. The abu supports the Ministry of Social Affairs and Employment in this approach. In order to regulate more effectively, the crackdown must be focused mainly on the individuals behind the mala fide constructions of international and other legal entities. The abu wishes to continue its commitment to publicprivate collaboration and is against a return to the
Indemnification The possibility to indemnify is also regulated as of this date. Companies that choose a certified private employment agency can indemnify themselves for the liability for overdue payroll and turnover tax: an extra incentive to choose bona fide agencies. The information exchange of data meaning that persistent fraudsters can be caught has already been partly introduced. However, an effective approach requires more exchange of information between sna, the cla police, the Inspectorate szw, the Chamber of Commerce, the Tax Authorities, Public Prosecutor and municipalities.
temporary employment license. The abu advocates that private and public enforcers work together faster and smarter in order to exchange information.
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Labour migrants Labour migrants from Middle and Eastern Europe are working In the Netherlands. Some of them work via the temporary agency sector. Around 70,000 of these so-called flex migrants are intermediated by abu members who are active in this field. The expectation is that the number of labour migrants will only increase.
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NATIONALITY
FOREIGN EMPLOYEES
Poles Slovaks Latvians, Lithuanians, Estonians Czechs Hungarians Portuguese Outside of Europe Spaniards Italians Romanians Slovenians Greeks Bulgarians Elsewhere in Europe Source: abu
79,2 % 5,0 % 3,3 % 2,0 % 1,3 % 0,5 % 0,3 % 0,2 % 0, 1 % 0, 1 % 0, 1 % 0, 1 % 0,0 % 7,7 %
LABOUR MIGRANTS: WORKING IN SECTORS Logistics Horticulture Foodstuffs industry Metal industry Agriculture Retail Other sectors Construction Cleaning Business services Government Transport Harbour, shipping and fishing Healthcare Catering
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abour migrants can make up for employee shortages. They contribute to a properly working labour market and to economic growth. It is very important that the growing labour migration is put on the right track. Dutch employment conditions must be adhered to and proper accommodation must be available to prevent nuisance due to illegal residential situations.
Evidently, mala fide practices must be dealt with. Illegal employment and bad accommodation is unacceptable and the temporary agency work sector is working together with the government to eradicate this.
PROPOSAL The European free traffic of services means that more and more foreign private employment agencies are becoming
Accommodation The abu cla for Temporary Agency Workers contains accommodation standards. Since 2010, the abu has used the “Certified Flex Home” certificate for accommodation, which complies with all requirements. On behalf of the trade association, independent private housing inspectors visit around 600 residential locations of labour migrants each year. As part of the National Declaration on Accommodation for Labour Migrants (2012) the social partners from the temporary agency, meat and horticulture sectors have also created a new independent quality mark for accommodation for labour migrants. This quality mark is to be launched in 2013. The current housing inspections are incorporated into this quality mark foundation. The housing quality mark, just as the sna certificate, will apply as a criterion for abu membership. In addition, the sector sits down with governments at all levels to rapidly resolve the shortage of suitable housing locations. Municipalities and housing associations in particular are important partners for the temporary agency work sector.
active on the Dutch private employment agency industry. The abu has no objection to this European provision of services: the abu is in favour of open borders, also shortly for Romanians and Bulgarians. Experience shows that access to the labour market by the front door leads to fewer problems than access by the mala fide back door. However, this must take place on a level playing field. Therefore, the abu advocates an expansion to the Terms of Employment (Cross-Border Work) Act in such a way that foreign private employment agencies apply all Dutch employment conditions. The abu also advocates stricter supervision in Europe on the issue of A1 forms and a Terms of Employment (Cross-Border Work) Act clause in every cla in the Netherlands. Furthermore, the abu wants municipalities to create more housing for labour migrants in their area. This will mean that bona fide entrepreneurs are no longer forced to house labour migrants in areas where the municipalities would rather not have them.
25,5 % 19,7% 16,1% 19,5% 18,7% 17,0% 14,0% 12,7% 12,3% 12,1% 10,8% 10,7% 10,3% 10,0% 10,0% % 2011
Source: abu
NUMBER OF LABOUR MIGRANTS INTERMEDIATED BY ABU MEMBERS
AT LEAST 70,000 Source: abu
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Conclusion The temporary agency work sector in the Netherlands has a history spanning 50 years in which the sector arose and flourished, became increasingly emancipated and meanwhile is widely acknowledged as an essential link in the labour market. This concerns providing flexibility to companies and leading target groups to the labour market.
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T
he extent to which the temporary agency work sector can continue to contribute to a properly functioning labour market in the future depends on the affordability and quality of the provision of services on the one hand and the appeal of the formula to employees on the other hand. Legislation and regulation with regard to social security to an important extent determine the price of placement (and therefore the appeal of this form of flexible service provision to companies) and the position of the temporary agency worker. In addition, the temporary agency workers’ employability will become more important than ever. Due to increasing emphasis on “a lifetime of learning” training is of crucial importance for the sector.
More and more, private employment organisations are showing the innovative power to provide permanent added value to the labour market. The abu calls on the politics and the other stakeholders (“the polder”) to support the temporary agency work sector in its role. The objective: the right balance between the collective interest of a strong economy (with adequate flexibility) and the individual interest of the employee (employment security for the temporary agency worker).
Temporary agency work works!
Sources
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Sources used for facts and figures
Statistics Netherlands
its, Radboud University of Nijmegen (2012) Opleidingsmonitor Flexbranche 2012 (Training monitor agency work sector 2012)
its, Radboud University of Nijmegen (2012) Arbeidsmarkttransities van uitzendkrachten in de periode 2007-2010 (Labour market transitions of agency workers in the period 2007-2010)
Ecorys (2009), Instroomonderzoek – Feiten en cijfers over uitzendkrachten (Inflow survey - Facts and figures on temporary agency workers)
Astri (2012), Aansluiting vraag en aanbod laaggeschoold werk (Matching demand and offer for less-skilled work) Leiden: Astri Beleidsonderzoek en -advies
uwv werkbedrijf (the work placement branch of the Employee Insurance Agency) (2011). Niet-werkende werkzoekenden aan het werk in 2010: wie zijn ze en waar vinden ze een baan? (Non-working job seekers back to work in 2010: who are they and where do they find a job?)
abu (2011) Ledenonderzoek buitenlandse werknemers 2011 (Member survey foreign employees 2011)
Council for Work and Income (2012) Dynamiek in uitkering en werk. Beschouwing bij het onderzoek Cliëntstromen in de Suwi-keten 2005-2008 (Dynamics and benefits and work. Consideration in the survey Client flows in Suwi-chain 2005-2008)
Temporary agency work works!
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[email protected] Internet: www.abu.nl Twitter: twitter.com/abunl
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Publication: Final edit: Design:
abu, February 2013 Communication Department abu Ideas*Bureau voor de Vorm bv, Haarlem
Temporary employment: investing in lasting flexibility
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