Disadvantages of being a temporary agency workerDocument Transcript
Disadvantages of being a temporary
There are lots of benefits that come when accepting a permanent contract with an
employer; pension schemes, guaranteed salary, company car, sick pay, holiday pay,
employee discounts, Christmas parties and many more. However, as the
country’s temporary agency labour market increases, several workers are being put at a
disadvantage to permanent staff.
More people are entering the temporary agency market as we come out of the
recession and people look for that financial input. Whilst the market does come with
various benefits, there are also disadvantages of being a temporary agency worker.
The main disadvantage is that a temporary contract is never as certain as a permanent
one. With the country’s economy still in a fragile state, temporary contracts are easier to
cease than the permanent ones. This means that temporary workers are working with
that tentative axe swinging above their heads.
Another main disadvantage is medical and financial cover if you were to injure yourself.
Temporary workers are very rarely covered under an organisation’s health and safety
insurance. This means that if a worker were to injure themselves at work or in leisure,
they would not receive the same support as a permanent worker.
However, there are positives behind these disadvantages, being that whilst a temporary
contract doesn’t come with the same security as a permanent, it does offer the flexibility
in moving from jobs, allowing workers to gain advantage and it is a good source of
gaining a permanent contract with an employer. Signing up to TempSure™, the
membership club for temporary agency workers, will provide you with Personal Accident
Insurance, which covers temporary workers in case you injury yourself at or away from
Disadvantages of contracting direct
The biggest risk of contracting directly with the client is getting paid.
Agencies are in the business of providing people to do a job, and paying
them, generally, on a time basis at the end of each week (or month) right on
the nail, because that’s what their workers expect.
Clients, who are generally large corporations or public sector departments,
are used to paying suppliers, who are generally other companies, as and
when it suits them. Many large businesses in the UK think it’s good financial
management not to pay suppliers until the supplier starts making a fuss.
This is also supposed to impress shareholders, with the company’s
management showing shareholders how tough they are in protecting
Unfortunately for contractors, they are a long way down the food chain in
the eyes of most large companies’ finance departments. They can wait up to
120 days to get paid, precisely because they are just another supplier and
not employees. And although the government has introduced laws to ensure
suppliers are paid on time, the sad truth is that they are routinely ignored.
Unfortunately for contractors, they are a long way down the food
chain in the eyes of most large companies' finance departments
Most agents have standard paperwork that they send to contractors when a
new contract is being discussed. Contractors will ask for some amendments
and will negotiate with the agent. With no agent the contractor has to run
the risk of signing up to a client’s standard contract (many of which are IR35
death-traps) or paying their own legal advisors to draft a contract. This, of
course, costs money.
Clients might want to work direct with the contractor, but insist the
contractor works through their preferred agency to maintain distance from
an employment law perspective, or because they simply want one bill at the
end of the month for all the contractors working for an agent, rather than
multiple bills direct from contractors. This is fine as long as the client
understands that the contractor’s rate is what they say it is and any agency
fees are on top of this.
And whichever route the contractor takes – agency or client – IR35 is always
a threat, so IR35 contract reviews are money well spent.
Cons of Hiring Temporary Employees
Every time a temp starts a new work assignment – no matter how skilled or unskilled –
a certain amount of training is required in order for them to perform their assigned tasks
to suit the specific needs of that company. Of course, if the same temp is brought back
again, this might not be required.
Morale and employee relations problems can arise when you have temps working
alongside permanent employees for months, doing the same work and putting in the
same hours, but not receiving the same benefits afforded their permanent employee
Certain types of jobs are inherently dangerous and require careful safety training.
Studies show that frequency and severity rates of on-the-job injuries are significantly
higher with temporary workers. No matter what a temp’s experience is, care must be
taken to see that dangerous tasks are performed safely. Never assume a temporary
worker is fully prepared to work unsupervised until you have taken the time to see that
they can safely perform their work tasks.
Recent court decisions have highlighted the fact that businesses must be careful how
they contract for temporary staff. There must be no doubt about the workers’ status and
about the lack of eligibility for the benefits of permanent employees. And treat temp
workers with the same respect and care you would for your permanent staff.
The question of reliability
Some surveys of employers have found an assumption that temporary workers are
generally less reliable than their permanent employee counterparts. Is this myth or
Joe Broschak, Assistant Professor of Organizational Behavior at the University of Illinois
at Urbana-Champaign, shared some of his findings about a particular study of
temporary workers: “On average, these temporary workers displayed better
performance relative to goals compared to their full-time counterparts.” For those temps
later hired as full-time employees, Broschak reported that “they continued to become
better workers after becoming permanent.”
Choosing a reputable staffing agency – and establishing a good employer/staffing
agency relationship and communications – are key elements to finding reliable workers,
say Ridenour and Broschak. Furthermore, Ridenour pointed to the rise of “free agents”
to 22% of the U.S. workforce, comprised in part by termporary workers, and increasingly
possessing impressive credentials: “As more and more employees choose to work as
free agents, the actual professional and education qualifications of free agents help
dispel the myth that temporary workers are less reliable.”
Disadvantages of temp jobs
No security… Without stating the obvious, the recession and the financial crisis has had
a knock on effect on the recruitment market. Now, most Employment Agencies will
argue that their temporary work force has been stronger than their permanent business,
as companies have been less confident about taking on staff for the long-term.
However, it is not so easy to be able to walk straight from one temporary job to another,
or even get a temporary job in the first place. Also as the candidate pool has grown
larger (as more skilled people are made redundant) the short-listing criteria for getting a
temporary job has increased and therefore graduates and the unemployed are fining it
tougher to be as employable as they were before.
Not good for the mortgage…Banks like people to be in permanent jobs – simple. A
permanent job gives you security and also gives a bank or a mortgage provider the
confidence that you will be able to pay your mortgage monthly and on time.
Depends where you live and what you do… During the recession there have been some
towns and cities that have remained pretty buoyant and some places in the UK and
further afield are not really in recession anymore. Therefore your chances of finding
temporary work are increased or decreased, depending on where you live. It’s the
‘have’ or ‘have nots’ in terms of places and employment opportunities…
Some places can be terrible… Especially if you
are in temp employment that is only expected to last for a few days or weeks, so
employers can be really bad to work for. As you are only seen as a ‘short term fix’ you
can be given little attention or care (until you are needed for something). The permanent
staff may not be bothered to communicate too much to you – because next week you
will be gone anyway! This can be rather disconcerting.
Contract Work: What To Watch Out For
While there are many upsides to contract work, it is not ideal for everyone. In particular,
if you do not savour the idea of having to re-market yourself to a new employer toward
the end of every contract job, then you should probably think twice before accepting a
Other potential negatives to consider:
Since other employees will know that you are only there for a specific amount of
time, they may not invite you in to their “inner circle” or share as much
information with you
You will be paid as a contractor, which means the employer will not deduct for
taxes. You must therefore make sure to remit your taxes to the government on
You may not be offered such ordinary entitlements as vacation pay, benefits,
training allowances, and pension contributions made by the employer
There will be no severance pay offered to you at the end of your contract (unless
you have negotiated a provision for this in your terms of employment)
It’s An Option To Keep In Mind
Depending on your personality and desire for stability, contract employment may or may
not be a suitable option for you. On the one hand, a fixed-term job gets you a foot in the
door and provides a short-term solution if you are currently unemployed. It allows you to
get to know the employer and could possibly turn into something more “permanent” if it
turns out there’s a mutual fit.
Then again, the need to job search again and again is built right in to this type of
position. Also you may be viewed as a temporary outsider by your co-workers, or you
may not be entitled to the kinds of benefits that a regular employee typically receives.
Therefore you should give it some thought before leaping into a contract job. But if you
do decide to go for it, you may just find it’s a great way to earn a living.