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Temporary Employment Agencies - Labour Brokers

A considered approach to temporary employment agencies from the ILO

[As at 1 November 2009, Convention No. C181 not yet ratified by South Africa]

To read the report Private employment agencies, temporary agency workers and their contribution to the labour market

To read the report RECOVERING FROM THE CRISIS: A GLOBAL JOBS PACT

GENEVA (ILO News) – A new report issued by the International Labour Office (ILO) says that workers employed by temporary employment agencies have been among the first to lose their jobs as a result of the financial and economic crisis.

At the same time, the report also observes that ratification of ILO Convention No. 181 on private employment agencies can help to promote Decent Work and ensure better functioning labour markets.

The report – “Private employment agencies, temporary agency workers and their contribution to the labour market” – points to a direct correlation between economic growth and the state of the employment agency industry, with the strong performance and expansion seen during the boom years mirrored by the weakness and contraction of the industry today.

The report will be discussed at a global tripartite meeting on October 20-21 at ILO headquarters titled “Workshop to promote ratification of the Private Employment Agencies Convention, 1997 (No. 181)”. Convention No. 181 balances enterprises’ needs for labour flexibility with workers’ needs for employment stability, a safe work environment, decent conditions of work and social security.

“Private employment agencies play an important role in the functioning of contemporary labour markets. They act as intermediaries in modern labour markets, allowing enterprises greater flexibility to increase or decrease their workforces, while ensuring for the workers sufficient security in terms of job opportunities and employment standards, including pay, working time and training”, the report says.

“The private employment agency industry has grown at an incredible pace over the past three decades due to the increasing need to provide workers and services to a growing and flexible labour market. User enterprises hire temporary agency workers to be able to rapidly adjust to the shifting economic realities. Since mid-2008, enterprises have used this pressure-valve function to lay off temporary workers, while often leaving their core workforce intact”, said John Myers, industry specialist from the ILO’s Sectoral Activities Department and author of the report.

The biggest temporary job losses were recorded in the manufacturing sector of developed countries, most noticeably in the car industry. The report cites the example of Germany, where it is estimated that between 100,000 and 150,000 temporary agency workers lost their placements in the four to six months after October 2008. Similar trends were seen in Japan, United States, Spain and France.

”Many of the largest private employment agencies are saying that it will be 2010 at least before they see any upturn in business. This would generally happen after overtime hours and the length of the working week begin to rise among the core workforce of user enterprises, and companies’ slack capacity begins to fall. When firms consider turning to agencies to meet their needs, this will be one of the first signs that the economic crisis is beginning to end”, said John Myers.

Meanwhile, the industry itself is introducing measures to cut costs and increase the efficiency of its services. According to the report, these measures will only be effective if the following challenges are addressed:

  • Continuing to ensure that national regulation on agency work is based on the flexicurity concept – achieving the right balance between the need for flexibility in the labour market while also ensuring the right protection for agency workers.
  • Assisting the transition of temporary workers displaced from user enterprises into other jobs as quickly as possible.
  • Staving off widespread business closures through cost-cutting and efficiency programmes.
  • Devising new ways of selling agencies’ services in an economic climate of cost-cutting by user enterprises and where some client firm – agency relationships have been damaged by the economic crisis.
  • Surmounting restrictions on agencies’ activities in certain countries and in certain sectors in post-recession recovering economies, as part of its quest for further global expansion.
  • Developing strategies to reflect various economic recovery scenarios: the possibility of a sustained rebound, a long flat period followed by a jobless upturn, or a brief rebound followed by renewed stagnation.
  • Rethinking its role in post-recession national labour markets as a means of increasing its penetration rates, particularly in the industry’s emerging markets of Eastern Europe, Latin America and Asia.

    “Countries that have not yet ratified Convention No. 181 are encouraged to do so, as its implementation can be an engine for job creation, structural growth, improved efficiency of national labour markets, better matching of supply and demand for workers, higher labour participation rates and increased diversity. It also sets a clear framework for regulation, licensing and self-regulation, thereby encouraging reliability; ensuring effective protection of workers against unfair practices; discouraging human trafficking; and promoting cooperation between public and private employment services. Finally, ratification could help to promote and implement the Decent Work Agenda by ensuring protection of the rights and working conditions of agency workers”, says the report.

    In recent months, several international-level policy statements have highlighted issues surrounding agencies and temporary agency work. For example, the June 2009 Global Jobs Pact refers to “establishing or strengthening effective public employment services and other labour market institutions” and “providing adequate [social protection] coverage for temporary and non-regular workers”.

    According to the report, “governments have come under pressure from a range of social actors to make changes to the benefits and social assistance provided to workers placed through agencies, although reform has been slow and piecemeal where it has occurred at all”.

    For more information, please contact the Department of Communication and Public Information of the ILO at communication@ilo.org - +4122/799-7912.

     

  • C181 Private Employment Agencies Convention, 1997

    Convention concerning Private Employment Agencies (Note: Date of coming into force: 10:05:2000)
    Convention:C181
    Place:Geneva
    Session of the Conference:85
    Date of adoption:19:06:1997
    Subject classification: Employment Services - Job Placement
    Subject: Employment policy and Promotion
    See the ratifications for this Convention

    Display the document in:  French   Spanish
    Status: Up-to-date instrument This Convention was adopted after 1985 and is considered up to date.

    The General Conference of the International Labour Organization,

    Having been convened at Geneva by the Governing Body of the International Labour Office, and having met in its Eighty-fifth Session on 3 June 1997, and

    Noting the provisions of the Fee-Charging Employment Agencies Convention (Revised), 1949, and

    Being aware of the importance of flexibility in the functioning of labour markets, and

    Recalling that the International Labour Conference at its 81st Session, 1994, held the view that the ILO should proceed to revise the Fee-Charging Employment Agencies Convention (Revised), 1949, and

    Considering the very different environment in which private employment agencies operate, when compared to the conditions prevailing when the above-mentioned Convention was adopted, and

    Recognizing the role which private employment agencies may play in a well-functioning labour market, and

    Recalling the need to protect workers against abuses, and

    Recognizing the need to guarantee the right to freedom of association and to promote collective bargaining and social dialogue as necessary components of a well-functioning industrial relations system, and

    Noting the provisions of the Employment Service Convention, 1948, and

    Recalling the provisions of the Forced Labour Convention, 1930, the Freedom of Association and the Protection of the Right to Organise Convention, 1948, the Right to Organise and Collective Bargaining Convention, 1949, the Discrimination (Employment and Occupation) Convention, 1958, the Employment Policy Convention, 1964, the Minimum Age Convention, 1973, the Employment Promotion and Protection against Unemployment Convention, 1988, and the provisions relating to recruitment and placement in the Migration for Employment Convention (Revised), 1949, and the Migrant Workers (Supplementary Provisions) Convention, 1975, and

    Having decided upon the adoption of certain proposals with regard to the revision of the Fee-Charging Employment Agencies Convention (Revised), 1949, which is the fourth item on the agenda of the session, and

    Having determined that these proposals shall take the form of an international Convention;

    adopts, this nineteenth day of June of the year one thousand nine hundred and ninety-seven, the following Convention, which may be cited as the Private Employment Agencies Convention, 1997:

    Article 1

    1. For the purpose of this Convention the term private employment agency means any natural or legal person, independent of the public authorities, which provides one or more of the following labour market services:

    (a) services for matching offers of and applications for employment, without the private employment agency becoming a party to the employment relationships which may arise therefrom;

    (b) services consisting of employing workers with a view to making them available to a third party, who may be a natural or legal person (referred to below as a "user enterprise") which assigns their tasks and supervises the execution of these tasks;

    (c) other services relating to jobseeking, determined by the competent authority after consulting the most representative employers and workers organizations, such as the provision of information, that do not set out to match specific offers of and applications for employment.

    2. For the purpose of this Convention, the term workers includes jobseekers.

    3. For the purpose of this Convention, the term processing of personal data of workers means the collection, storage, combination, communication or any other use of information related to an identified or identifiable worker.

    Article 2

    1. This Convention applies to all private employment agencies.

    2. This Convention applies to all categories of workers and all branches of economic activity. It does not apply to the recruitment and placement of seafarers.

    3. One purpose of this Convention is to allow the operation of private employment agencies as well as the protection of the workers using their services, within the framework of its provisions.

    4. After consulting the most representative organizations of employers and workers concerned, a Member may:

    (a) prohibit, under specific circumstances, private employment agencies from operating in respect of certain categories of workers or branches of economic activity in the provision of one or more of the services referred to in Article 1, paragraph 1;

    (b) exclude, under specific circumstances, workers in certain branches of economic activity, or parts thereof, from the scope of the Convention or from certain of its provisions, provided that adequate protection is otherwise assured for the workers concerned.

    5. A Member which ratifies this Convention shall specify, in its reports under article 22 of the Constitution of the International Labour Organization, any prohibition or exclusion of which it avails itself under paragraph 4 above, and give the reasons therefor.

    Article 3

    1. The legal status of private employment agencies shall be determined in accordance with national law and practice, and after consulting the most representative organizations of employers and workers.

    2. A Member shall determine the conditions governing the operation of private employment agencies in accordance with a system of licensing or certification, except where they are otherwise regulated or determined by appropriate national law and practice.

    Article 4

    Measures shall be taken to ensure that the workers recruited by private employment agencies providing the services referred to in Article 1 are not denied the right to freedom of association and the right to bargain collectively.

    Article 5

    1. In order to promote equality of opportunity and treatment in access to employment and to particular occupations, a Member shall ensure that private employment agencies treat workers without discrimination on the basis of race, colour, sex, religion, political opinion, national extraction, social origin, or any other form of discrimination covered by national law and practice, such as age or disability.

    2. Paragraph 1 of this Article shall not be implemented in such a way as to prevent private employment agencies from providing special services or targeted programmes designed to assist the most disadvantaged workers in their jobseeking activities.

    Article 6

    The processing of personal data of workers by private employment agencies shall be:

    (a) done in a manner that protects this data and ensures respect for workers privacy in accordance with national law and practice;

    (b) limited to matters related to the qualifications and professional experience of the workers concerned and any other directly relevant information.

    Article 7

    1. Private employment agencies shall not charge directly or indirectly, in whole or in part, any fees or costs to workers.

    2. In the interest of the workers concerned, and after consulting the most representative organizations of employers and workers, the competent authority may authorize exceptions to the provisions of paragraph 1 above in respect of certain categories of workers, as well as specified types of services provided by private employment agencies.

    3. A Member which has authorized exceptions under paragraph 2 above shall, in its reports under article 22 of the Constitution of the International Labour Organization, provide information on such exceptions and give the reasons therefor.

    Article 8

    1. A Member shall, after consulting the most representative organizations of employers and workers, adopt all necessary and appropriate measures, both within its jurisdiction and, where appropriate, in collaboration with other Members, to provide adequate protection for and prevent abuses of migrant workers recruited or placed in its territory by private employment agencies. These shall include laws or regulations which provide for penalties, including prohibition of those private employment agencies which engage in fraudulent practices and abuses.

    2. Where workers are recruited in one country for work in another, the Members concerned shall consider concluding bilateral agreements to prevent abuses and fraudulent practices in recruitment, placement and employment.

    Article 9

    A Member shall take measures to ensure that child labour is not used or supplied by private employment agencies.

    Article 10

    The competent authority shall ensure that adequate machinery and procedures, involving as appropriate the most representative employers and workers organizations, exist for the investigation of complaints, alleged abuses and fraudulent practices concerning the activities of private employment agencies.

    Article 11

    A Member shall, in accordance with national law and practice, take the necessary measures to ensure adequate protection for the workers employed by private employment agencies as described in Article 1, paragraph 1(b) above, in relation to:

    (a) freedom of association;

    (b) collective bargaining;

    (c) minimum wages;

    (d) working time and other working conditions;

    (e) statutory social security benefits;

    (f) access to training;

    (g) occupational safety and health;

    (h) compensation in case of occupational accidents or diseases;

    (i) compensation in case of insolvency and protection of workers claims;

    (j) maternity protection and benefits, and parental protection and benefits.

    Article 12

    A Member shall determine and allocate, in accordance with national law and practice, the respective responsibilities of private employment agencies providing the services referred to in paragraph 1(b) of Article 1 and of user enterprises in relation to:

    (a) collective bargaining;

    (b) minimum wages;

    (c) working time and other working conditions;

    (d) statutory social security benefits;

    (e) access to training;

    (f) protection in the field of occupational safety and health;

    (g) compensation in case of occupational accidents or diseases;

    (h) compensation in case of insolvency and protection of workers claims;

    (i) maternity protection and benefits, and parental protection and benefits.

    Article 13

    1. A Member shall, in accordance with national law and practice and after consulting the most representative organizations of employers and workers, formulate, establish and periodically review conditions to promote cooperation between the public employment service and private employment agencies.

    2. The conditions referred to in paragraph 1 above shall be based on the principle that the public authorities retain final authority for:

    (a) formulating labour market policy;

    (b) utilizing or controlling the use of public funds earmarked for the implementation of that policy.

    3. Private employment agencies shall, at intervals to be determined by the competent authority, provide to that authority the information required by it, with due regard to the confidential nature of such information:

    (a) to allow the competent authority to be aware of the structure and activities of private employment agencies in accordance with national conditions and practices;

    (b) for statistical purposes.

    4. The competent authority shall compile and, at regular intervals, make this information publicly available.

    Article 14

    1. The provisions of this Convention shall be applied by means of laws or regulations or by any other means consistent with national practice, such as court decisions, arbitration awards or collective agreements.

    2. Supervision of the implementation of provisions to give effect to this Convention shall be ensured by the labour inspection service or other competent public authorities.

    3. Adequate remedies, including penalties where appropriate, shall be provided for and effectively applied in case of violations of this Convention.

    Article 15

    This Convention does not affect more favourable provisions applicable under other international labour Conventions to workers recruited, placed or employed by private employment agencies.

    Article 16

    This Convention revises the Fee-Charging Employment Agencies Convention (Revised), 1949, and the Fee-Charging Employment Agencies Convention, 1933.

    Article 17

    The formal ratifications of this Convention shall be communicated to the Director-General of the International Labour Office for registration.

    Article 18

    1. This Convention shall be binding only upon those Members of the International Labour Organization whose ratifications have been registered with the Director-General of the International Labour Office.

    2. It shall come into force 12 months after the date on which the ratifications of two Members have been registered with the Director-General.

    3. Thereafter, this Convention shall come into force for any Member 12 months after the date on which its ratification has been registered.

    Article 19

    1. A Member which has ratified this Convention may denounce it after the expiration of ten years from the date on which the Convention first comes into force, by an act communicated to the Director-General of the International Labour Office for registration. Such denunciation shall not take effect until one year after the date on which it is registered.

    2. Each Member which has ratified this Convention and which does not, within the year following the expiration of the period of ten years mentioned in the preceding paragraph, exercise the right of denunciation provided for in this Article will be bound for another period of ten years and, thereafter, may denounce this Convention at the expiration of each period of ten years under the terms provided for in this Article.

    Article 20

    1. The Director-General of the International Labour Office shall notify all Members of the International Labour Organization of the registration of all ratifications and acts of denunciation communicated by the Members of the Organization.

    2. When notifying the Members of the Organization of the registration of the second ratification, the Director-General shall draw the attention of the Members of the Organization to the date upon which the Convention shall come into force.

    Article 21

    The Director-General of the International Labour Office shall communicate to the Secretary-General of the United Nations, for registration in accordance with article 102 of the Charter of the United Nations, full particulars of all ratifications and acts of denunciation registered by the Director-General in accordance with the provisions of the preceding Articles.

    Article 22

    At such times as it may consider necessary, the Governing Body of the International Labour Office shall present to the General Conference a report on the working of this Convention and shall examine the desirability of placing on the agenda of the Conference the question of its revision in whole or in part.

    Article 23

    1. Should the Conference adopt a new Convention revising this Convention in whole or in part, then, unless the new Convention otherwise provides -

    (a) the ratification by a Member of the new revising Convention shall ipso jure involve the immediate denunciation of this Convention, notwithstanding the provisions of Article 19 above, if and when the new revising Convention shall have come into force;

    (b) as from the date when the new revising Convention comes into force, this Convention shall cease to be open to ratification by the Members.

    2. This Convention shall in any case remain in force in its actual form and content for those Members which have ratified it but have not ratified the revising Convention.

    Article 24

    The English and French versions of the text of this Convention are equally authoritative.

    Cross references
    Conventions: C029 Forced Labour Convention, 1930
    Conventions: C034 Fee-Charging Employment Agencies Convention, 1933
    Conventions: C087 Freedom of Association and Protection of the Right to Organise Convention, 1948
    Conventions: C088 Employment Service Convention, 1948
    Conventions: C096 Fee-Charging Employment Agencies Convention Revised), 1949
    Conventions: C097 Migration for Employment Convention Revised), 1949
    Conventions: C098 Right to Organise and Collective Bargaining Convention, 1949
    Conventions: C111 Discrimination (Employment and Occupation) Convention, 1958
    Conventions: C122 Employment Policy Convention, 1964
    Conventions: C138 Minimum Age Convention, 1973
    Conventions: C143 Migrant Workers (Supplementary Provisions) Convention, 1975
    Conventions: C168 Employment Promotion and Protection against Unemployment Convention, 1988
    Revised: C034 This Convention revises the Fee-Charging Employment Agencies Convention, 1933
    Revised: C096 This Convention revises the Fee-Charging Employment Agencies Convention (Revised),1949
    Supplemented: R188 Complemented by the Private Employment Agencies Recommendation, 1997
    Constitution: 22:article 22 of the Constitution of the International Labour Organisation

     

     

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