Temporary employment is explained as an arrangement between the employer and the employee where an employee is hired on the payroll of the company at a given job profile only for a certain predefined tenure. Temporary employees are also known as seasonal, contractual, freelance, third-party employees or in short “temps”. One feature of temporary employment is that the workers remain detached from the ongoing relationship with the organization where they work in (Burgess & Connell 2006). The prime objective of a temporary employment agency or a temp agency is to identify the job seekers and retain them as employed. The organizations which have requirements and openings for short term workers usually establish a contract with these agencies on for providing the human resources to work under a project for certain fixed amount of time. Temporary employees may also have the opportunity to achieve permanent employment status after the completion of the predefined tenure of the contract. The benefits availed by a contractual employee are usually less than the benefits given to the permanent employee.
Why do organisations prefer temporary employment?
There are various reasons for which the requirement of temporary employment arises in organizations such as unavailability of human resources due to medical sickness, planned or unplanned vacations, unexpected or temporary demand of work force for some major projects, lack of skilled employees etc.
Various pros of temporary employment policy of the companies can be accounted as in terms of maintaining the staffing flexibility, employment pool of temporary and full-time employees result in more productive and efficient workplace. Seasonal employment helps in evaluating workers without commitment. Some people prefer to work on temporary basis rather than as a full time employee, this helps the companies to offer position along with time to resource that suits their business best. Hiring a temp can also be a good way to getting work done without breaking the workflow of the assignments, while the recruitment team keeps exploring the suitable candidate for a particular job. If the performance of a third party resource is unsatisfactory, then the recruiters need to escalate this as an issue or alert to the outsourcing agency. Another benefit of temporary employees to the organization is that the investment of time and money on the training and induction of these employees is reduced as they are hired for a short span of time and are not on the payroll of the Organization (Burgess & Connell 2006).
In terms of monetary prospective of the employee, one of the major benefits is the exemption of tax. As the employment is not on permanent basis and the income is not fixed so the employees get exempted from paying tax (Rhoades McKee 2012). In majority of the cases, the cost of a temporary employee is less than a permanent employee. Less investment is required in the business for temporary employments because proper documentation and administration costs like payroll, taxes, unemployment benefits, workers compensation insurance, and additional benefits to the employee are the responsibilities of the staffing agency, not the organization (Rhoades McKee 2012).
Temporary employment is beneficial for those people who want to gain working experience, the people who just want some extra income and for the individuals who are facing problem in finding a permanent job, it’s like a stepping stone for them (Svedaite 2013). Temp employment is a very attractive option for students who wants to earn along with their studies, house wives who are willing to work as a freelance employee and work from home and people who have are incapable of working as a full time employee (Zijl 2006).
It is often said that the existence of temporary work is beneficial in many ways to currently unemployed job seekers as it provides them with a lot of opportunities existing in the market. They are able to gain work experience, knowledge as well as to acquire human capital, hence making them more attractive candidate for potential employers. Individuals working in temporary positions enlarge their social network, which at times help them to explore and hunt more effectively for more desirable jobs and profiles (Zijl 2006).
Temporary employment in India
In India, the concentration of casual or seasonal labour is highest in agriculture, hunting and forestry sector as compared to other sectors as the nature of work in these sectors is seasonal (Employers’ n.d.). It has been witnessed that the number of contractual employees in India are increasing every year in the field of construction, cement manufacturing etc. (Employers’ n.d.). In the year 2011-2012, about 42 percent of the employees in the AGEGC (Agriculture Sector excluding growing of crops) and non-agriculture sectors were temporary employees. The proportion was 60 percent for casual labourers and 28 percent for regular wage/salaried employees (Survey 2014). In India, the proportion of temporary employees in urban area is comparatively less than the rural areas. The exciting fact is that the proportion of female temporary employees is comparatively more than the temporary male employees in both urban and rural areas (Survey 2014).
Temporary employment in India is an emerging trend with exponential growth prospects as the ratio of permanent jobs and job seekers is not balanced. Due to lack of jobs, people prefer to work as a contractual or temporary employee. The mining and manufacturing industry is fast growing in India which will hence lead to increase in contractual labourers by the organizations and the government (Goldar & Aggarwal 2010). The agriculture sector which has the major concentration of casual workers is also growing and fast developing in India, it was noticed that the ratio of rural female temporary workers has increased over the period of time (Anon 2009) (Survey 2014).
- Anon, 2009. Indian Labour Market Report 2008, Available at: http://www.macroscan.org/anl/may09/pdf/indian_labour.pdf [Accessed April 4, 2015].
- Burgess, J. & Connell, J., 2006. Temporary Work and Human Resources Management, Emerald Group Publishing. Available at: https://books.google.com/books?id=FgNdPZ0Nht8C&pgis=1 [Accessed April 4, 2015].
- Employers’, A.I.O. of, INDUSTRIAL RELATIONS & CONTRACT LABOUR IN INDIA. Federation house, pp.1–20. Available at: http://www.ficci.com/spdocument/20189/Industrial-Relations-and-Contract-Labour-in-India.pdf [Accessed April 4, 2015].
- Goldar, B. & Aggarwal, S.C., 2010. Informalization of Industrial Labour in India: Are labour market rigidities and growing import competition to blame?, Available at: http://www.isid.ac.in/~pu/conference/dec_10_conf/Papers/BishwanathGoldar.pdf [Accessed April 4, 2015].
- Rhoades McKee, 2012. DO THE RISKS ASSOCIATED WITH HIRING TEMPORARY EMPLOYEES OUTWEIGH THE BENEFITS? Available at: http://www.rhoadesmckee.com/assets/files/articles/2012 publications/Temporary Employees.pdf [Accessed April 4, 2015].
- Survey, N.S., 2014. Informal Sector and Condition of Employment in India. , 68, pp.1–884. Available at: http://mospi.nic.in/mospi_new/upload/nss_report_557_26aug14.pdf [Accessed April 4, 2015].
- Svedaite, E., 2013. Investigation of the Advantages and Disadvantages of Temporary Employment. , pp.64–70. Available at: http://www.su.lt/bylos/mokslo_leidiniai/soc_tyrimai/2013_30/svedaite_tamosiunas.pdf [Accessed April 4, 2015].
- Zijl, M., 2006. Economic and social consequences of temporary employment. , pp.1–163. Available at: http://www.uva-aias.net/uploaded_files/publications/Proefschrift_20060621.pdf [Accessed April 4, 2015].