Temps Demand a New Deal

Temps Demand a New Deal

With this issue, we resume our ‘What Works’ series, which explores effective projects and strategies for improving people’s lives through progressive social change.
      –The Editors


contingent 1

liable to occur but not certain; possible





Amid Silicon Valley’s torrid dot-com boom, stories abound of peach-fuzzed college graduates pulling down six-figure salaries and, in short order, securing their American dream. For them there is no shortage of opportunity–for new business ventures, luxury cars and seven-figure homes. Yet beneath this gilded veneer a class war is brewing. The Valley’s legions of temps dream of getting full-time jobs and keeping homelessness at bay in a place where the median home price has soared to $365,000 and a standard two-bedroom apartment rents for $1,500 a month.

For veteran Silicon Valley temp workers like Julian Cornejo, the stark disparities drive home the point that temps–long underpaid, underemployed and “disposable”–must band together to improve conditions and restrict the ability of employers to exploit their labor. Cornejo’s experience illustrates the precariousness of the contingent life. A mechanical designer with thirty years’ experience, he has been stuck on the temp-work treadmill, with no benefits or job security, for fifteen years. After suffering a shoulder injury while temping at a Palo Alto semiconductor firm in 1998, Cornejo spent nearly a year fighting his temp agency for workers’ compensation, leaving him broke and in debt. His wife and kids moved out to escape the financial and emotional stress. Then, his bills mounting and paychecks dwindling, Cornejo lost his apartment. He has been staying in a homeless shelter for months. Cornejo applied for a community college course on computer-aided design, which could give him the skills to escape temping–but there’s a one-year waiting list because the school doesn’t have enough full-time faculty.

Fed up with the powerlessness and isolation, in February of last year Cornejo went looking for a temp labor union. What he found, thanks to a story in a local newspaper, was a unique temp workers’ association called Working Partnerships USA. Launched by San Jose’s South Bay AFL-CIO Labor Council in 1995, Working Partnerships runs a nonprofit temp firm and offers health insurance for temps. Emphasizing membership services, it occupies one end of a spectrum of new organizations for contingent workers, rising up both within and outside unions, that are giving voice and structure to a growing chorus of temp-worker frustrations. As Eileen Wodjula, a Working Partnerships member and Silicon Valley temp for several years, puts it, “We have to start all over again, with a new workers’ movement.”

The explosion of temping and the shifting of employment relationships away from traditional jobs poses what may be organized labor’s greatest challenge and opportunity since World War II: organizing the swelling ranks of temps, day laborers, contract and leased workers whose perpetual job insecurity forms the porous foundation of today’s supposedly stellar economy. A handful of unions and dozens of advocacy groups are experimenting with a tactically and politically diverse range of approaches. Some are organizing temps directly into existing unions; in LA 74,000 homecare workers classified as independent contractors joined the Service Employees International Union (SEIU) in February 1999, after pressuring the county to set up a public agency to act as their employer in collective bargaining. Other unions and community groups are creating nonprofit temp agencies and Consumer Reports-style codes of conduct designed, in the spirit of constructive engagement, to coax the temp industry into undertaking voluntary reforms. The Chicago Coalition for the Homeless is helping temps and day laborers, many of whom live in city shelters, to form workers’ centers and co-ops to negotiate better wages and conditions. And a New York City-based nonprofit called Working Today focuses on harnessing affordable and portable healthcare and other benefits for New York’s self-employed and other independent contractors, while advocating policy reforms for its 93,000 members nationwide.

Spearheading the movement is a thirty-five-group umbrella coalition called the National Alliance For Fair Employment, which promotes a deliberately flexible range of solutions. “We see the need for a multipronged strategy because with the rise of temping and a real restructuring of the labor market, there is absolutely no one fix,” explains Tim Costello, director of the Boston-based Campaign on Contingent Work, an alliance member group. With a national “rollout” this spring, the alliance, which includes worker justice groups from twenty states and Washington, DC, hopes to create a national presence to bolster contingent organizing and legislative campaigns. With input from the AFL-CIO and other labor groups, the alliance is creating a network and political profile for initiatives ranging from local grassroots organizing to state and federal legislation aimed at expanding contingent workers’ currently minimal protections under equal pay, pension and labor organizing laws.

Although advocates embrace a big-tent approach, there is a “tension in this whole area of contingent work between outlawing the hiring of temporary workers” and reforming conditions, says Chris Owens, the AFL-CIO’s assistant director for public policy. It’s no coincidence that the rise of contingency has paralleled the decline of unionization–to the point where a stunning 90 percent of all private-sector workers are nonunion. Backed against the wall since the Reagan years, most unions have, until lately, assumed a defensive posture, opposing the creation of temp jobs as a unionbusting strategy rather than looking for ways to unionize temps. Asked how unions can build temp-worker power, one union official says, “I don’t feel like we have an answer for that yet. We are at the bottom of the ocean with a teaspoon on this issue.”

The AFL-CIO now calls contingent labor a “priority issue,” but high-level officials there acknowledge that labor has yet to make the all-out push required to organize temps on any significant scale. “There’s a serious question as to whether organized labor will put the money and resources together to do it,” says organizing director Kirk Adams. “That’s still an open question.” Labor’s answer will determine not only how (and how many) temp workers are organized but also the extent to which unions wield power and control work in an increasingly temp-dependent economy.

Millions of ‘Second-Class Workers’

The scope and role of contingent labor in today’s economy is staggering. Nearly one-third of America’s workers–about 30 million–toil in temporary, contracted, self-employed, leased, part-time and other “nonstandard” arrangements, according to a 1998-99 study by the Economic Policy Institute. Over the past decade, the temp industry has enjoyed phenomenal growth, outpacing most sectors of the economy. Since 1990 the number of workers employed daily by temp agencies has shot up from 1.2 million to 2.9 million, according to the American Staffing Association. Temp jobs constitute a startling 25 percent of all new jobs created since 1984.

In a fundamental restructuring of work, businesses now farm out not just special projects but everyday functions like office cleaning, payroll processing, human resources departments and entire clerical and assembly-line units. “It’s all a function of companies trying to externalize any cost that is not core to what they do,” explains Amy Dean, executive officer of the South Bay AFL-CIO Labor Council. Adds employment relations professor George Gonos of SUNY-Potsdam, who has studied temp labor for twenty years, “This is about a massive secondary labor market that has been created in every occupational group, producing a burgeoning group of second-class workers.”

Contingent jobs are embedded in every sector of the economy, affecting workers of all collars. Their diverse ranks include high-tech software engineers and office workers; janitors, taxicab drivers and chicken catchers misclassified as independent contractors; adjunct college professors; and home healthcare workers. As Ellen Bravo, co-director of 9 to 5, the National Association for Working Women, puts it, “This is a labor problem that crosses class.”

What potentially unites such disparate workers is the tenuous status they all share–and the fact that they take home nearly $100 less per week than their nominally permanent counterparts. Government and industry studies show 60-70 percent of contingents wish for something more stable. Just 20 percent of contingent workers (and under 4 percent of all temps) receive employer health insurance, compared with more than 50 percent of noncontingent workers, according to the Bureau of Labor Statistics. Similarly, only one-fourth of contingent workers are eligible for employer pension plans, while nearly half of permanent workers qualify. Perhaps most significant, the vast majority of contingents fall through vast loopholes in worker-protection laws and have no union representation. They have been cast adrift to fend for themselves in an increasingly volatile labor market.

Now avenues for collective response are emerging. The National Alliance For Fair Employment has drafted codes of conduct that use the pressures of publicity–both good and bad–to convince temp agencies to treat temps in ways workers once took for granted: providing detailed job descriptions of wages, benefits and duration of assignments; insuring that temps get the same safety equipment as permanent workers; allowing temps to register with several agencies and to get permanent jobs with client companies; and allowing temps at unionized client companies to join collective bargaining agreements.

Yet such voluntary measures only go so far. And the sheer diversity and mobility of contingent jobs complicates direct organizing, making legislation critical to obtaining equal pay and benefits for temps. “Whatever power can be generated at the workplace must be directed to getting regulations across the labor market,” says Costello. “We don’t want to rely on workplace-by-workplace, association-by-association standards.”

On the movement’s legislative docket:

§ the Massachusetts Workplace Equity Bill, sponsored by dozens of state legislators, which would require equal pay and benefits for contingent workers who do the same work as permanent employees;

§ Congressional measures authored by Illinois Representative Lane Evans that would prohibit companies from cutting contingents out of pension plans, extend health and safety protections to temps and outlaw pay discrimination against temps; the bills, with six co-sponsors each, are still in committee;

§ Washington State’s Employee Benefits Fairness Act of 2000, which would ban companies’ “permatemp” strategies of misclassifying employees as temp or contract workers in order to deny them benefits such as paid leave and stock discounts;

§ temp worker “right to know” measures, passed in Rhode Island and South Carolina and proposed in Washington State, which would require agencies to provide temps with job descriptions, pay rates and work schedules.

Temp-industry officials insist that new laws and unions are unnecessary. Edward Lenz, senior vice president of the American Staffing Association (a trade group representing 1,400 temp companies), says the temp industry opposes equalizing benefits for temps because “employers ought to be free to say ‘we’re going to provide coverage to this group of workers and not to that group of workers.'” Lenz adds, “Although it may strike some people as arbitrary or unfair, the law currently allows them to do that, for reasons that don’t have to be justified.” So the industry and its clients continue to benefit from pension and labor laws that don’t cover “that group”–namely, temps. The National Labor Relations Act, for instance, typically excludes temps from forming bargaining units with permanent workers, a serious hindrance to their unionization. Numerous proposals to reform this have made little headway.

Reform or Revolution?

For unions, the soaring use of temps raises some vexing questions. How, for instance, do you organize ever-mobile temp workers who are employed by several agencies and who move among dozens of job sites in a single year? Are temps best served by a union of their own that can bargain with local and national temp agencies, or by allying themselves, shop by shop, with their permanent jobmates? Should unions try to reform the temp industry, compete with it or combat its very existence?

Around the country, different answers are emerging, yielding varying degrees of success. Throughout Rhode Island, temp companies line inner-city neighborhoods “on almost every corner, like liquor stores,” says Mario Bueno, program coordinator for the United Workers Committee, part of a statewide United Campaign for Permanent Jobs, involving unions, churches and community groups. Low-wage temps working on factory assembly lines (who must pay $15-$20 a week for company buses to outlying factories) “are doing the exact same work they always did as permanents,” says Bueno, and they “are not filling in for anybody.” Yet many persist for years in manual “temp” jobs without healthcare (or even access to the company microwave in the lunchroom), under the impression they will eventually be hired as permanent workers. Temps from textile mills, jewelry factories and canning companies have used public hearings and direct actions to pressure Rhode Island to pass legislation requiring temp agencies to disclose job descriptions, pay rates and work schedules. The United Campaign also pushed (unsuccessfully) for rules limiting prohibitive “conversion fees” that temp firms charge client companies when they want to hire one of their workers for a permanent job.

In Silicon Valley, with a temp-labor boom “going on against the backdrop of prosperity,” Amy Dean of the South Bay Labor Council created the multipurpose Working Partnerships USA that Cornejo stumbled upon, which has garnered much national press attention. Instead of organizing temps into a union, the council tapped foundation funding to set up Working Partnerships, which emphasizes tangibles like a temp-worker healthcare plan with income-adjusted premiums and a type of temp-worker hiring hall. “Our goal is not to build Temporary Workers of the World Unite,” says Dean, who three years ago was picked by AFL-CIO president John Sweeney to head a committee on the future of the labor movement. “When you ask people why they want to join this organization, they don’t say, So I can go in the street and advocate for better conditions. They say, I want portable benefits, I want a job.”

So, following in the footsteps of a mid-nineties effort by Bay Area temps and the Industrial Workers of the World to create a worker-owned temp agency, Working Partnerships has launched a nonprofit “socially responsible” staffing firm that aims to give temps a bigger slice of the pie and to act as a role model for how competing agencies should treat their workers. So far it’s been tough going: While 150 workers have enrolled in the service, many need additional training; the agency currently has just three to five temps working on any given day and pays them a minimum wage of $10 an hour, says Lisa Hoyos of Working Partnerships’ staffing service. The agency is targeting large union firms, public agencies and small private-sector companies as job-placement clients. The ultimate goal, says Hoyos, is to be a self-sustaining firm providing pensions and benefits to all its temps. The nonprofit agency is part of a broader strategy to create a membership organization with benefits and other education and training opportunities, says Dean, who plans a public relations campaign via radio, print and the Internet to draw temps from throughout the region. Working Partnerships will then try to cajole area temp agencies to abide voluntarily by a code of conduct.

In New Jersey a similar code-of-conduct campaign has benefited from low unemployment rates, as temp agencies are “scrambling to get bodies,” says Barrie Peterson, employment specialist with the nonprofit United Labor Agency of Bergen County, which runs the Bergen Employment Action Project’s Temp Worker Alliance. So far thirty-two New Jersey temp companies, mostly small to mid-size firms that “want to distinguish themselves as a high-practice agency,” have signed the project’s fair-conduct code, says Peterson. The project publishes a consumer guide listing “best practice” temp agencies that abide by the code, a strategy to promote more labor-friendly firms and to help temps shop around for better treatment.

But ultimately such voluntarism must be backed by concrete temp-worker power, says SUNY’s George Gonos. “The code of conduct means nothing on paper unless you organize…. If you can’t move significant numbers of temp workers from one agency to another because the second agency is adhering to your code, you have no market power whatsoever. The whole strategy from time immemorial has to be about power, control over the labor market.”

Don’t Mourn, Organize

While Working Partnerships USA and others stress the need for innovation, some unions have found success organizing temps the old-fashioned way. “Too many people have bought the notion that temporary workers are unorganizable,” says Wade Rathke, whose union, SEIU Local 100 in New Orleans, has organized and won contracts for temp garbage-truck workers. When New Orleans privatized its municipal garbage collection in the eighties, “all the laborers on the back of the truck were contracted to a variety of temp agencies, some of which existed almost solely to provide labor for the sanitation department,” says Rathke. Suddenly 250 longtime city “hoppers,” who toss trash into the trucks, were temps receiving minimum wage and no benefits.

“The irony is these workers had a lot more control over the jobs than you might think,” Rathke notes. “They controlled the work because they were the ones who knew how to do it, and when they had an issue the garbage still had to be picked up.” Precisely because they were temps, the hoppers could choose just when to withhold their labor. A few years ago, in the middle of a scorching New Orleans summer “we came to one of those periods where we were just too damn tired to work,” says Rathke, forcing the companies to come to the bargaining table or risk losing their contracts as resident complaints piled up by the hundreds. The key tactic for temps, he says, is “to look at the combustion points, where they have to be there for the work to be done, and you have some power in the situation.”

On the other end of the temp spectrum, contingent high-tech workers at Microsoft and other Washington firms in the Puget Sound region are crafting their own union, called WashTech, in a steadfastly anti-union sector. They are targeting thousands of web designers, technical writers and software engineers–including more than 3,000 at Microsoft alone–employed for years through temp agencies and denied access to company healthcare and pensions, as well as stock options. So far 250 temps at fifty high-tech companies have joined the union, affiliated with the Communications Workers of America.

High-tech temps “might want flexibility, but they are not choosing to go without healthcare, without a pension plan and without the same kind of labor protections that are afforded other workers in this country,” says WashTech co-founder Marcus Courtney, himself a temp test engineer at Microsoft. Instead of focusing on the temp agencies, WashTech organizes temps at their work sites, says Courtney. “Our organization is not about some agency that doesn’t employ them, it’s about where they work.”

Battling temp isolation and “employers’ tactics of fear and intimidation,” WashTech is using the Internet and e-mail, as well as collective actions, to bring temps together, says Courtney. When twenty Microsoft temps represented by WashTech tried to form a collective-bargaining unit, neither Microsoft nor the four temp agencies involved would recognize them. But the workers’ pressure paid off, as Microsoft quietly began acceding to their demands for wage parity and job reclassifications to reflect their skill levels. “They got those changes because they organized,” says Courtney. Their efforts have been buoyed by a Ninth Circuit Court of Appeals ruling last May that Microsoft illegally misclassified regular staff as temps and independent contractors to deny them stock options and other benefits. This January the US Supreme Court, for the second time, refused to hear Microsoft’s appeal of the circuit decision. Now, however, Microsoft is fighting back by limiting the terms of temp workers to avoid paying benefits.

Day Laborers Get Strategic

Far outside the universe of traditional unions, day laborers, mostly Latino and African-American, are building their own collective-action groups. In Portland, Oregon, where “most of the building trade unions are pretty white,” it’s “almost not even an option” for day laborers to join, says Jeri Sundval, formerly of the Workers Organizing Committee there. The committee began organizing day laborers in 1996, initially fighting a wave of anti-immigrant legislation and constant harassment by the INS and local police. “We’re like the urban farmworkers,” says Sundval.

“In the hierarchy of needs, these folks are way at the bottom. They are worrying about food and shelter every day,” says Sundval. Portland’s day laborers, numbering about 100 in winter and up to 500 in summer, were stuck at Oregon’s $6.50 minimum wage and were easily cheated since they were paid in cash with no recordkeeping. Organizing block by block, the laborers agreed to work for no less than $8 per hour–a standard that Sundval says has been upheld. Now the committee, which helps represent the laborers in hundreds of wage and unemployment claims, is setting up a workers’ center, where the laborers can “wait for work in dignity,” protected from Portland’s near-ceaseless rains.

In Chicago, police sweeps and flagrant day-labor-agency abuses have inspired uprisings among the city’s burgeoning, largely Latino day-labor force. According to Chirag Mehta, researcher at the University of Illinois Center for Urban Economic Development, somewhere between 30,000 and 50,000 Chicagoans rely on day labor; this includes some 75 percent of the city’s homeless shelter residents, a recent study by the center found. “They are living day by day, working day by day in a cycle of homelessness and day labor,” says the center’s research director, Nikolas Theodore. Many are undocumented immigrants, according to José Landaverde, Latino task force coordinator for the Chicago Coalition for the Homeless, which is helping the laborers get organized. Recently three laborers, angered at being underpaid, showed Landaverde their paychecks: “They worked eight hours and got paid $28.25 for the day. The employment agencies do whatever they want because they assume the workers don’t have documents.”

But in February these workers, many of them women, fought back with loud street protests, public hearings and a one-day strike against one of the day-labor agencies. With good media coverage and help from a city alderman, they shut down two agencies that were operating without licenses and allegedly taking illegal deductions for nonexistent benefits and pensions, says coalition organizer Dan Giloth. The coalition, working closely with Jobs with Justice, the Interfaith Committee for Workers’ Rights and various local unions, is lobbying the city to spend $1.9 million to finance eight workers’ centers where day laborers can wait for work in peace. The centers would be run by day-laborer board members, says Giloth, and are part of a long-term strategy to create a day-laborers’ co-op to negotiate better wages and conditions.

As the contingent-workers movement gains ground, the potential for new organizing hits up against serious financial limitations. Apart from a few large grants from the French American Charitable Trust, the Ford Foundation and others, there is meager financial support for the contingent-workers movement. “Right now we are a few bones connected to maybe a skeleton,” says Peterson of the Bergen Employment Action Project, which operates on just $15,000 a year. “All of us are struggling to somehow get our local projects to survive.”

But union officials close to the movement say there is another significant hurdle–organized labor’s general lack of awareness about the need to unite contingent workers with permanent employees. “Most people, including many local unions, don’t know that contingent labor is quicksand under their feet,” says Maureen Ridge of SEIU Local 925 in Boston, which works closely with the Massachusetts Campaign on Contingent Work. Because temps are especially difficult to organize under current labor law, says Ridge, unions usually seek easier paths to expand their shrinking memberships. “Why would we be looking at all these temp workers who can’t be organized under the National Labor Relations Act when there are still all these other workers out there who can be, and when we are shrinking and we need to grow quickly? You only have so many resources, so many hours in a day, and we are all focused on survival…. All of this work on temps is out of the realm of our regular work.” As contingent jobs increasingly become America’s regular work, the challenge is to make the organizing of contingent workers part of organized labor’s regular work. That process has only just begun.

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