September/October 1995
Employing temporary workers can be a way to cut costs, improve flexibility, and take workers on a trial run. But the utility of temps is often limited, and the can exacerbate some problems.
By Lynn R. Novelli
Lynn R. Novelli is a writer based in Russel, Ohio
For better or worse, many scrap companies have at least tried using temporary labor to augment their permanent work force during peak periods or for special projects.
For some companies, such as Schupan & Sons, positive experiences with temporary labor have led them to make temps an integral part of their work force. Others, like Atlas Metal & Iron, would rather use temps only when absolutely necessary. And still others have temp strategies that fit somewhere in between these poles. But no matter where these companies fall in the spectrum of employing industrial temps, all agree that there are potential pluses and minuses to using temporary laborers—and understanding those factors is the key to making the most of temps, however they are employed.
Containing Costs
Temporary laborers, sometimes called "the contingency work force," offer many advantages, says Burnett. Schupan & Sons, a scrap recycling company that processes a wide range of materials and operates at eight locations, augments its relatively small core group of permanent employees with a large contingency labor force—as many as 100 temps a year—including office and professional temporaries.
"Using contingency labor is a matter of "cost containment," he says, voicing the positive factor most often mentioned by processors using temps. Although scrap companies generally pay hourly wages to temporary laborers that are comparable to those of permanent employees, the savings in workers' compensation and benefit expenses can be considerable. Even with the fee the company pays the agency providing the temps, the total cost of a temp's time can reportedly be as little as half that of a permanent employee.
Other advantages of using temporary laborers include greater flexibility in staffing and relief from the burden of screening job applicants. "Using a temporary agency has made my job a lot easier," says Tom Nelson, general foreman of Shine Brothers Corp. (Spencer, Iowa), a wire chopping operation that usually has 8 to 10 temps on the floor. "I used to have to prescreen all the job applicants," he says. "Now, the agency does all that for me."
Use of temps may also limit a company's legal risk exposure. "Litigation [brought by temporary employees] has not been an issue" at Schupan & Sons, says Burnett, "but if it were to arise, we would likely only be a third party."
But, Horrors...
Then there's the other side of the equation, where horror stories about temporary help abound. Nearly everyone who has ever employed temps seems to have a tale about the worker who came to work drunk, showed up late every day, walked off the job after half an hour, or had an attitude problem. An all-too-commonly reported experience is the temporary employee who eventually gets hired on a permanent basis only to later file a workers' compensation claim.
But like most stereotypes, the image of the temporary laborer as an unreliable drunk with a prison record is an oversimplification at best. "A certain percentage of the temporary labor market is made up of good, reliable workers with a solid employment history who have been laid off," notes Gary Smythe, compliance supervisor with Shredders Inc. (Birmingham). "This type of worker may use a temporary agency as a fast-and-easy way to get back to work as soon as possible."
In any case, successfully integrating temporary workers into a scrap operation is certainly not easy, says Robert Millstone, president of Montgomery Scrap Corp. (Rockville, Md.). Montgomery Scrap, a metal recycling company with 40 permanent employees, uses temps two to three times a year and has had "mixed experience" with them.
Such uneven results back up the assertion of managers who use temps that certain jobs are more suitable for contingency workers than others. "We have tried temporary workers in various jobs to find the most effective way of using them," says Millstone. "In our experience, using temps to process material is not cost-effective because the training curve is too long. We also have found that most of them were not interested in learning a job and would not stick with it."
As an example, he notes, "We tried using temps to cut chillers and spent the time to train four people. Many times we did not get the same people back and had to train new ones. The ones we did get back on a regular basis lost interest after a period of time and slacked off so much that our only option was to let them go."
After having suffered several experiences like this, Montgomery Scrap now uses temporaries only for less-skilled jobs on a short-term basis, such as screening steel scrap to separate metal from dirt. "For these types of jobs, temps are very good. But for the skilled jobs that are essential to running a scrap yard, we are better off training our own people who want to work for a salary and benefits," says Millstone.
Of course, temps may not be thrilled in the long term with such low-skill jobs. Mark Onustock, plant manager for E-Z Recycling Co. ( Portland , Ore. ), a scrap paper packer, says, "We use six temps full-time, all the time, for sorting newsprint on the conveyor. It's a monotonous job, so I find they may hang out for three to four months, then move on."
Which brings us back to the horror stories. Since work at the bottom of the scrap processing ladder can be tedious, dirty, and physically demanding, it tends to attract lower-quality workers—temporary or permanent. Onustock takes a philosophical perspective. "We have had our problems with drunkenness, sexual harassment, and just plain laziness among temps," he says. "But, for light industrial work at $5 to $6 an hour, you get the same problems with temps or regular employees. It's just human nature."
Competition for what's available in the labor pool is another reason it can be difficult for scrap recycling companies to find good temporaries. Atlas Metal, for example, pays temps $9 an hour, which is competitive in the Denver market, but still finds it difficult to attract good temps, says Rosen. "We see a lot of the skid row-type of worker looking for a day's wages. The quality temps are usually out doing agricultural work."
Safety Concerns Expand
The potential for undesirables in the temporary labor pool can be of particular concern when it comes to safety issues. Since temps generally feel less like part of the company, they may be less likely to buy into the company's safety policies, magnifying the potential for accidents. What's more, due to their lack of experience in the industry, temps may be more careless than permanent employees or not appreciate the need for safety procedures on the job.
Some scrap recycling companies are less willing than others to expose themselves to these risks. "Statistics show that anytime you put on a new worker, he is likely to be less safe than an experienced one," says Rosen. And it is because of this potential for a poorer safety record that Atlas avoids using temps. "We feel they detract from our overall effort to maintain a safe workplace," he explains.
Indeed, safety concerns represent a big reason why very few scrap recycling companies will place a temporary worker in anything but the lowest-risk jobs. "We are careful about what jobs we use temps for," offers Jack Shikles, senior vice president of Tewksbury Industries Inc. (Tewskbury, Mass.), a metal recycling firm. "We do not allow them to drive any moving vehicles, operate equipment, or have access to certain restricted areas."
As a result of such concerns, temps employed by scrap recycling firms may, again, only end up in repetitive, monotonous tasks, which can also contribute to safety problems via inattentiveness in an intrinsically dangerous environment. To reduce the boredom factor and related risks, some companies rotate their temps through various jobs.
In addition, many scrap recyclers that employ contingency workers require that they go through complete safety training. Handled appropriately, this sort of invested effort and concern can help temps feel more integrated into the work force, more like part of the company. "I treat anyone who comes through the door as an E-Z Recycling employee," says Onustock. "I put everyone through the same safety program and try to emphasize to the temporaries that they are on an equal footing with our permanent employees and have the same responsibilities for safety." Ditto, Tewksbury .
A "mentoring" system that teams every temp with a long-term permanent employee can be another effective safety precaution when using contingency labor, according to Schupan & Sons. The company, which combines mentoring with close supervision and job rotation, regularly earns industry awards for its safety record, despite its heavy reliance on temporary laborers, says Burnett.
Hand-in-hand with the risk of injury to temps or workers around them is another concern—damage to property, material, or machinery, notes Nelson. "We once had a temp who had been with us for three weeks when he became very careless about throwing material onto the conveyor. He threw a piece of steel on that was at least a foot-and-a-half in diameter. When that piece got jammed in the cutter, it shut the whole system down for hours," he recalls. "It was a completely avoidable situation that was the result of sheer carelessness."
Working With Agencies
Considering the significant problems the wrong temps can present, simply signing up with a personnel agency that agrees to send out the necessary number of warm bodies is not the best way to find good temps, cautions Burnett.
So what is a good method for finding an agency that will be responsive to your needs? Some recycling companies swear by small, local agencies, arguing that they are better to work with. Burnett, who uses as many as 15 to 20 different agencies, believes the company gets better service from the small, personal personnel agencies. "They tend to know us better—so they can do a better sales job [on potential temps] and are more likely to give us better candidates," he says.
But other recycling firms report they have had just as good luck in sourcing temps through large, national agencies.
"Whatever agency you select, start by meeting with the account rep or salesperson," advises Burnett, and get to know that individual. To get the most out of a temporary service—and the best workers—he says, "You need a relationship with the people at the agency so when you call them, you know who they are and they know who you are." He adds, "Get to know them on an individual level. It can be a great help to the relationship." Schupan & Sons goes so far as to invite their temp agency reps on company outings to make them feel part of the company.
Of course, a warm personal relationship with an account rep at the agency is no guarantee against getting the occasional bad apple for a temp, says Onustock, but it can circumvent many problems. "They get to know what you need and can prescreen applicants to increase your chances of getting a good candidate."
Providing the agency complete and accurate descriptions of the available positions is also an important part of getting the right temps. In addition, many companies provide basic guidelines or descriptions of the qualifications they want in a temp, such as previous experience in a related job. At Shine Brothers, for example, Nelson specifies he wants applicants who have mechanical ability and who are punctual, literate, and willing to work nights.
As for the agency's responsibilities, scrap companies should expect the agency to check applicants' employment histories, noting the number of jobs, length of service, and reasons for leaving. The client can also request that the agency check on driving records, alcohol or drug abuse, and criminal records. (Many agencies have no policy against hiring individuals with known problems in these areas.)
Even with accurate job descriptions and careful screening, placing quality temporary workers in a scrap plant can be difficult. "It's a hot, dirty environment, and the work is hard," points out Yolanda Garrett, staffing consultant with Trillium Staffing Solutions (Kalamazoo, Mich.). "When we discussed our concerns with [a scrap recycling] client, the company responded by raising the hourly wage it was offering by a full $1. That was enough to change the whole situation and allow us to place higher quality workers there."
Shine Brothers similarly bit the bullet, says Nelson. "We count on our temporary service to send us good people, so we do not have to spend two to three months training them," he says. "We used to pay $4.50 an hour but have brought it up to be competitive and get the better workers." Now the company's wages are high enough to compete with other local employers to ensure that daytime positions, at least, can easily be filled. Night shift jobs can still be problematic, admits Nelson.
Looking for Permanents
Many scrap recycling companies use temporary labor as a source of and proving ground for new hires. "When we find the good ones, we try to hire them," says Smythe.
This temp-to-perm strategy is not only an efficient way to fill permanent positions, but can also help get higher-quality workers. "The word is out that we hire from our contingency pool and that Schupan is a good place to work, so it has become a sales tool for the agency to use in placing people," explains Bumett.
To make the most of this effort, many of those scrap recycling companies that hire permanent staff from among temporaries have developed a system to sort out the real keepers from among all the temporaries that may pass through the operation. For example, companies that use the temporary labor pool as a testing ground for potential new hires often require that a worker be on the job for 90 to 120 days or more with "temporary" status.
During that trial period, each temp can then be observed for punctuality, level of interest and motivation, ability to perform the job and other, often intangible, qualities, such as willingness to go the extra mile when needed. This is also a time when permanent employees working alongside the temps can size up their prospective coworkers and tell their supervisor when they think a temp will not work out.
In addition, the trial period can offer potential employees an opportunity to really want that permanent position. Because of this, Schupan & Sons makes a calculated effort to help temps feel they are part of the company, Burnett says. "We invite temps to company outings, picnics, and events. If they are here for 120 days or more, they get holiday pay, and those who are here during Thanksgiving receive a turkey just like our permanent employees."
Bonus or Bogus?
Whether temporary workers are a bane or a boon for a scrap processing firm depends on many factors, some of which are out of the company's control. To work, it certainly takes some effort. For example, says Millstone, "Finding the right jobs that temps can perform may take some experimenting. Once you determine what jobs they can perform on a short-term basis, temporary workers can be very good."
Onustock adds enthusiasm, tempered with caution: "If someone is thinking of trying temps, I would encourage it. Using temps can be a useful way to screen applicants and find good solid people for the future. Just be careful not to hire them on too quickly and talk to them first to gauge their attitude. If you do it right, using temps can be very good for the company."
Employing temporary workers can be a way to cut costs, improve flexibility, and take workers on a trial run. But the utility of temps is often limited, and the can exacerbate some problems.