Yes, it’s another dry-looking bill: Massachusetts House Bill 1393, sometimes referred to as the Reform the Employment Agency Law (REAL). But at stake, apparently, is the future of the staffing industry in Massachusetts and beyond.
There’s real power on both sides of the debate about this bill. Proponents include more than two dozen Massachusetts labor and community development groups and at least 88 Massachusetts legislators.
Opponents include the Massachusetts Association of Personnel Services, the Massachusetts Staffing Association and the American Staffing Association in Washington, DC.
Each side is predicting catastrophe. “The proponents of this legislation have cast a very, very wide net,” said Stephen Dwyer, general counsel for the American Staffing Association, “which would ensnare and devastate the entire industry.”
Supporters such as MassCOSH, a Massachusetts labor group, call the legislation a vital element to stomping out “a growing crop of temporary agencies (that is) hindering our hopes for economic prosperity” in Massachusetts.
For real?
According to Marcy Goldstein-Gelb of MassCOSH, the bill is a response to the growth of temporary staffing in the state. “(The bill) is both an attempt to streamline the process that professional (staffing) agencies have to go through, and to kind of regulate some of the agencies that handle more of the blue-collar jobs,” she said.
The only evidence I could find of troublesome Massachusetts staffing firms were the brief examples on the MassCOSH fact sheet about tax and insurance fraud by two unnamed temp agencies (one has to wonder if they were agencies at all).
However, Goldstein-Gelb stated that “regardless of the inherent vulnerability” involved in hiring temps, “there’s enough of a growth in the industry” to warrant the bill. She also states that a report to be issued soon will highlight this growth in more detail.
According to Dwyer, the bill is both completely unnecessary and dangerous to the industry.
“The position of the ASA is that worker rights are paramount to us,” he said. “Temp workers are protected by all labor and employment laws that protect every employee. To the extent that there are bad actors, what is needed is greater enforcement of existing laws rather than new laws designed to create extra burden on staffing firms.
“The bill could be interpreted – and I think this is a dangerous potential – as a means to impose rate caps, and eliminate conversion fees and temp-to-hire,” Dwyer said. “Its net effect will be to make it harder to find jobs during a still fragile recovery.”
A read-through of Massachusetts H1393 reveals a proposed standard for staffing firm registration, a mandated paperwork trail for each temporary employee and some subtle changes regarding fees for temp-to-hire situations.
Issues in the bill include:
- Sections 46B-46F, which defines a standard registration process for legitimate staffing firms in Massachusetts.
Proponents say it’s necessary to establish a level playing field for all legitimate Massachusetts staffing firms. “(Detractors) say it’s cumbersome,” said Goldstein-Gelb. “Why don’t they take a look at what professional agencies have to go through now? They have to go through licensure. This is a much more streamlined process.”
Dwyer, however, says the section “goes beyond registration – this goes beyond making records available for inspection. It brings new requirements and burdens upon staffing firms that are wholly unnecessary.” He also points out that the new process would provide for registration, but eliminate licensure – which allows for agencies to charge certain fees – altogether.
- Section 46G, which proscribes a thorough job order to be furnished in writing to each temporary staffer within 72 hours of any work start date. This job order would include 13 different multilingual pieces of information regarding place of employment, dates, fees, wages and expenses.
“The piece of paper that’s required, the professional agencies are already required to provide,” Goldstein-Gelb said. “They have to provide a paper trail. They have to do it when they’re paying (the workers).”
“That would be a new requirement – paperwork,” said Dwyer. “Staffing firms place hundreds of thousands of jobs every day. (They) provide most if not all of that information orally, and that amount of paperwork would be difficult if not impossible. The fact is, if you’re a staffing firm and you don’t tell your candidates where to go, to whom, what safety equipment they’re going to need and what they’re going to earn, that staffing firm won’t be in business very long.”
- Section 46I(k), which restricts temp-to-hire fees under North American Industry Classification System (NAICS) code 54.
“It applies to anyone who is not in that classification, Code 54,” Dwyer said. “It does not use the words ‘conversion’ or ‘direct hire fees.’ But the larger issue is that it would wipe out an entire spectrum of the staffing industry, (for example) nurses, office clerical and physicians.”
So who has the upper hand?
Goldstein-Gelb says that the current version of H1393, currently pending debate by the Massachusetts Joint Labor and Workforce Development Committee, was developed with “a lot of back and forth with the (staffing) industry.” In fact, she says there’s even a staffing agency, EDA Staffing, Inc., that’s on board with the bill.
Dwyer says that the current bill is an iteration of several past dialogues, many of them hinging on the legitimate staffing industry model vs. temp workers “being picked up in the park.”
“The so-called abuses that this law would be designed to address – bait-and-switch, being lied to about Workers Comp, fraud – all of that is already protected under the existing law,” he said.
“I will say this – we have seen iterations of this bill going on ten years now. Each time it failed to pass – the reason being the proponents, well-meaning or not, are not right. The proponents are concerned about the welfare of employees, as are we.
The problem is that they are inflating any problem that may exist. We wouldn’t be successful in defeating this legislation if the claims truly bore out, if they existed to the extent that we’re hearing from them.”
{ 4 comments… read them below or add one }
I don’t see anything wrong with the section that requires agencies to provide thorough job orders. In my mind, that’s just logical. A couple lawsuits out there (see: Wal-Mart) have stemmed from not being told the nature of their work, and ending up in “unsavory” situations.
Having said that, I understand the argument about the rest of the bill. Just another way for the government to get its hands on everything, to put on a show of being involved when what it really wants is to penalize everyone.
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Very few jobs anywhere, in any industry, operate under a highly detailed “job description.” Duties change. Skills are acquired, enabling workers to assume higher level tasks. Under existing employment law, all employers, including temporary staffing employers, have legal obligations to assure that each employee is properly selected and trained to perform all tasks safely. Furthermore, requiring a lower wage worker to travel to a central office to pick up a written “job description” every time duties change, hits him or her in the pocketbook and often delays the start of the assignment. Staffing agency employers fill a niche enabling companies flexibility and quick turnaround. This bill will harm Massachusetts companies and create extra expense for the most vulnerable workers.
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Yes people need some addition to laws out there to weed out the shitbags and scammers but this is the wrong direction. If anything employment agencies should be positioned to collaborate not bare burden to the state’s cost or clog up systems with tape. Staffing companies are in a REAL position to help lift some of the dependencies of the government and aid towards company growth if only…
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I am behind this bill 100%. I have been temped to debt, and truly believe this bill is in the employees’ best interest. If the bill becomes instrumental in subordinating or snuffing out the staffing industry in Mass., the more power to it. Staffing/temp firms are growth-oriented and parasitic at the employees’ expense. Believe me, most employees would rather be hired directly by the place they’re actually working at. Temps should be unionized and hired through hiring halls. I have worked in this arrangement in the past. I made $30/hr through the union while agency-hired coworkers made $15/hr. The union took 2% of my pay for dues vs. the staffing/temp agencies’ 30%+ cut. A manager assured me the company paid the same amount for the unionized vs. staffing agency workers.
Employees of staffing firms with a buy-out fee are vulnerable to being passed over as direct-hire employees for candidates with no fees to buy out. Like most employees, I had to resort to staffing/temp agencies because these agencies “own” so many jobs. I had so many horrible experiences with temp agencies. You guys seem great at convincing companies that the contract-to-perm or contract situation is a win-win arrangement. Well, the contracted employees loose.
As a temp, I have always looked for direct-hire work while temping. One time I accepted a direct-hire position and the temp agency I was working through told me that I “couldn’t” leave them. I just told this agency that I had training and a benefits package waiting for me. So many agency jobs have ended abruptly for me, but when you decide to leave an agency position, they balk. I can go on and on about my very negative experiences with working with agencies. The industry needs to be investigated and regulated; they are growth-oriented and parasitic at the employees’ expense.
I hope this bill makes it impossible for many staffing agencies to continue doing business, and that the companies hiring through them become accountable for hiring employees directly, or using fairly-paid employees through unions.
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