Today’s so-called “contingent” work force is pretty much the same as it was four years ago, despite the upheaval of Sept. 11, 2001, corporate scandals, recession, war, and, finally, economic recovery, the U.S. Bureau of Labor Statistics reported last Wednesday. Despite the sameness, there were a few findings of interest to the staffing industry.

BLS uses a broad definition of contingent workers: persons who do not expect their jobs to last or who report that their jobs are temporary. According to BLS, most contingent workers are independent contractors and on-call workers, but the agency considers most temporary-help and contract-firm workers as contingent.

BLS began a biennial survey of contingent workers in February 1995, which was silently suspended in 2003, thereby missing the effects of the 2001-02 shocks to the U.S. economy. Thanks in part to ASA efforts, BLS resumed the survey this February.

But the 2003 survey gap means comparing this year’s rebound data against February 2001 data, when economic expansion and overall employment peaked—it was the month before the recession officially began. While more people are employed today than in 2001 and the current unemployment rate is low by historical standards, this year’s BLS contingent work force survey of 60,000 households was conducted only months after an extraordinarily long “jobless” recovery.

The BLS survey results show that the proportion of U.S. workers holding contingent jobs was little different in February 2005 than in February 2001, but the effect of the recession is noticeable:

• In 2001, a slight plurality—45%—of “temporary help agency workers” preferred their alternative work arrangements to traditional ones. In 2005, 32% preferred the alternative, comparable to 33% in 1999.
• In 2001, 48% of temporary help agency workers were covered by health insurance, 11% by their employer. In 2005, 40% were covered, 8% by their employer—comparable to the 1999 figures of 41% and 9%, respectively. Over the same six-year period, contract worker coverage continued to be very high at 80%; employer coverage declined slightly to 49%.
• School enrollment among temporary and contract workers dropped precipitously, from 28% for both groups in 2001 to 5% for temporary workers and 13% for contract workers in 2005.

ASA will report on additional findings in future issues of Staffing Week. A summary of the results is available at www.bls.gov from the Economic News Releases page.

Steve Berchem

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Last week, a three-judge panel of the California Court of Appeals, in a rare move, unanimously reversed itself and held that the California Insurance Guarantee Association is liable for the workers’ compensation claims left unpaid when RemedyTemp’s carrier became insolvent.

In an opinion issued last fall, the same three judges upheld a decision of the California Workers’ Compensation Appeals Board that CIGA had no liability to pay the claims because there was “other coverage,” namely Remedy’s customer’s carrier, available to pay the claims. Remedy had argued that the parties’ intent that Remedy’s insurer be the sole source of coverage for injuries to its workers, as permitted by California statute, was clear and should be enforced. Other parties argued that the statute relieves customers from liability entirely if they contract with a staffing firm to cover the assigned workers. But the court said the law was intended to avoid duplicate insurance, not to extinguish the customer’s obligation as a joint employer or to prevent the customer from covering the assigned workers. Only a specific exclusion from coverage in a form consistent with state insurance law would suffice to relieve the customer of liability, the court said.

Following that ruling, it came to light that the state had no established process for issuing exclusionary endorsements. Based on this information, Remedy petitioned the same three-judge panel to rehear the case. The court granted rehearing and, based on the new information, determined that the state’s requirements for obtaining such endorsements were vague and uncertain and could not be imposed on Remedy’s customer and its carrier without prior notice. Under the circumstances, the court said that CIGA should not have been dismissed, and remanded the case to the WCAB for reactivation of the outstanding claims against CIGA.

The court did not say that exclusionary forms are necessarily required in all cases, but Remedy’s lead
outside counsel, Andrew Lundberg, a partner with the Los Angeles law firm of Latham & Watkins LLP, told ASA that the court’s opinion leaves open the possibility of future disputes. One approach would be to ensure that customers’ insurance carriers obtain exclusionary endorsements approved by the state department of insurance—and the staffing industry could work with state insurance authorities to develop such a form. But Lundberg said there were practical problems with that approach since staffing firms are not parties to their customer’s insurance policies and therefore can’t readily ensure that such exclusions are actually used. He suggested that a broader regulatory or legislative solution might avoid similar disputes in the future. ASA, which filed a friend of court brief in support of Remedy’s position, will examine the options and report on ways in which the industry might respond.

Ed Lenz

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“Reports from all 12 Federal Reserve districts indicate that economic activity continued to expand,” the Federal Reserve Board said in last week’s “beige book” report on current economic conditions for June and July. “Several districts reported increased demand for temporary workers, while no districts reported weaker demand for temps.”

Boston “The first district economy continues to expand,” the beige book reported. Hiring for manufacturing and related services companies has been concentrated in sales, marketing, and high-end technical positions.

New York According to the report, “A major NYC employment agency describes the job market as lukewarm, noting that hiring activity has been a bit slower.” In contrast, employment in the financial industry has accelerated.

Philadelphia “Demand for temporary workers has picked up for health care, administrative, and some skilled manufacturing occupations,” the beige book said.

Cleveland “Hiring continued to be modest in most industries,” the report said. “Nevertheless, staffing-services companies reported an increase in the number of job openings, especially for workers with specific skills, such as accountancy and information technology.”

Richmond District staffing firms “reported continued strong demand for workers,” the book said. “Warehouse, production, sales, administrative, and software skills in particular were widely sought.”

Atlanta “Reports suggest that labor markets tightened in some sectors and temp hiring increased,” the beige book said.

Chicago “Labor market conditions improved slightly overall,” the book reported, “but conditions varied by location and industry.” Hiring increased in the banking, trucking, and distribution industries.

St. Louis “Business activity in the eighth district has continued to expand,” the report said. “Firms in the freight transportation, utilities, leisure, and insurance industries reported plans to open new facilities and hire new workers.”

Minneapolis “Employment growth was evident,” the beige book stated, and business contacts “report difficulty finding skilled workers.” A Minneapolis temporary employment firm “noted that demand was up from three months ago, particularly for specialized jobs such as accounting and human resources.”

Kansas City “Labor markets in the district firmed further,” the book said. “Hiring announcements exceeded layoff announcements by a considerable margin.”

Dallas The district “labor market continued to strengthen, with more reports of hiring, employees being bid away, and scattered problems hiring skilled workers,” the book said. Temporary staffing firms also noted increased demand.

San Francisco “Demand for labor increased, and district labor markets tightened further,” the book reported. “Contacts in the agricultural, retail, services, and financial sectors reported substantial reliance on temporary workers to meet demand.”

Allyson Schuster

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Be recognized for your creative advertising campaigns, innovative marketing concepts, and original company publications by entering the 2005 Staffing Industry Communications Awards competition.

The entry deadline is Aug. 8.

For details, visit the “memberserv” section of www.staffingtoday.net. Questions? Contact Reem El-Khatib at 703-253-2047 or relkhatib@americanstaffing.net.

Reem El-Khatib

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Does it sometimes seem like your technical customers are talking in secret code? Learn some basic tech speak during the Aug. 11 InterAction seminar “Technical Services—Talking the Talk,” presented by Susan Hodges, founder of SemCo Enterprises Inc.

Hodges will explain five areas of technology: platforms, development, data, communications, and applications. Then she’ll teach you the specific terms and skills that are in demand in each area. Throughout the seminar, Hodges will teach you common IT jargon, including SQL, servlet, proxy server, and JavaBeans. Add these terms to your knowledge base and sound like a pro. This seminar is a must for all salespeople, recruiters, and anyone else who communicates regularly with the technical community.

Too busy to leave your office? You don’t have to—InterAction comes to you. Dial the toll-free number, turn on your speakerphone, follow along on the Internet, and train your entire team on a wide range of industry topics, all from the comfort of your own office—and for one low price. Questions during the seminar? No problem. The format is interactive.

To register, visit the InterAction page in the “memberserv” section of www.staffingtoday.net. Questions? Contact Amanda Morgan at 703-253-2056 or interaction@americanstaffing.net.

Ron Goode

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Are you looking for a way to show your knowledge and demonstrate your abilities to current and potential customers? ASA’s Certified Staffing Professional™ and Technical Services Certified™ designations can give you the edge you’re looking for.

The certification programs offer an in-depth, self-study course and exam on employment law. After becoming certified, you can demonstrate your knowledge and commitment to professional standards by using the CSP™ or TSC™ designation on your business cards, company letterhead, advertising, and more.

For more information on how certification can give your firm a competitive edge, visit the Certification Programs page in the “memberserv” section of www.staffingtoday.net.

Simone Bielsker

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