Types of Temporary Agency Employments and Their Conditions

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Theoretical Framework, Part 1.

This chapter will answer Research Question 1 by presenting the theories behind temporary agency work, the industrial sector, and de-motivators in general and among TAWs. It will also explain the difference between de-motivators and motivators.

The Temporary Agency Industry

Temporary employment is a modern invention that has caused a lot of debate on the labor market. This is due to its significant growth in such a short period of time (Holmlund & Storrie, 2002) together with the special working conditions this type of employment implies (Ward et al., 2001). In the European Union, temporary agency work has been the fastest growing form of employment over the last twenty years. In Sweden alone, the use of TAWs has increased by more than 500% (European Trade Union Confederation, 2007). Still, the potential growth within the industry is high. According to Blanpain & Graham (2004), the industry has a potential to double in Europe in the near future. This makes the market for temporary agencies of great interest to research, and even though there exist previous studies, this field still has unexploited areas that are in need of further investigation.
According to Blanpain & Graham (2004) there are several reasons as to why companies use TAWs. The most common reason is that the companies want to increase labor flexibility, and consequently cut labor cost. Also, the trend of focusing on core competencies has increased the use of temporary agencies in terms of hiring staff for positions outside the core activities. Finally, for many companies, using temporary agencies instead of hiring on their own has also become a fast and inexpensive way of screening employees. All of these reasons have contributed to the market growth and made temporary agency work a type of business to be reckoned with on the labor market.

Temporary Agency Work

According to Biggs & Swailes (2006), temporary agency work is a special kind of employment where a person is employed by a temporary agency (staffing company) that in turn hires out that person to another company. The temporary agency function is to be an intermediary between the host company that is in need of personnel, and the employee. The authors further explain that this is commonly called the “Triangular Relationship” which can be seen in figure 2-1, and describes the relationship between the Temporary agency worker, the temporary agency firm, and the host company.As shown in Figure 2-1, the temporary agency is responsible for everything except for managing the daily work, which falls on the responsibility of the host company where the temporary agency worker carries out his or her daily work. The host company signs a contract concerning the hiring out of employees with the temporary agency, and consequently pays a commission to the agency for its services (Biggs & Swailes, 2006).The role of the temporary agency firm is to be able to provide their customers with educated and knowledgeable employees within specific fields (Bronstein, 1991). This allows the host company to rapidly replace temporarily absent personnel, or add personnel when there is an increase in workload (European Trade Union Confederation, 2007). The temporary agency manages all the costs and administration concerned with the TAWs, and the employee reports his or her work hours and salary claims to the agency (Nienhüser & Matiaske, 2006).

Types of Temporary Agency Employments and Their Conditions

To be able to investigate de-motivators among Proffice employees further on in the study, the following section provides background information on the different employments that a TAW can hold. The section below is provided in order to give the reader an understanding of why the authors have chosen to interview TAWs employed under different contracts within Proffice, and how their salary is regulated. There are several different kinds of employment alternatives involved in temporary agency employment. A person can be employed as a civil servant and thus be employed under the HTF/Academic Unions agreement (HTF, 2009). To be employed as a civil servant means being employed at an office. A temporary agency worker can also be employed under the collective wage agreement by LO; The Swedish Trade Union Confederation. This employment is vocationally oriented and the employed worker does not necessarily have any specialized qualification (LO, 2009). Another common employment, which is also regulated under the collective wage agreement, is hourly employment. Temporary agencies are not allowed by Swedish laws and regulations to hire part time employees, thus temporary agencies hire workers on an hourly basis under the condition that the workers have an additional occupation such as studies or another hourly employment. The special law policy for the Swedish labor market is known as “The Swedish model”. It includes different regulations, and the two key elements are the centralized wage bargaining, and the active labor market policies. (Freeman, Topel,Swedenborg, 1997). These regulations were implemented in order to protect employees from being exposed to adverse working conditions (Blanpain & Graham, 2003). “The Swedish model” thus means more strict regulations for employers, and better working conditions for the employees (Freeman, Topel, Swedenborg, 1997). These wage agreements and the labor market policies are what make the “Swedish Model” unique compared to those of other countries. In many other countries, TAWs are faced with worse working conditions and salaries than those of regular employees. However, even though TAWs might be better off in Sweden compared to other countries, the TAWs still have less beneficial employment conditions than those of regular employees (European Trade Union Confederation, 2007), which contributes to the authors’ interest in TAWs. To further elaborate on what “The Swedish Model” contributes with, the wage agreements regarding TAWs needs to be explained. The TAWs employed under LO in Sweden are guaranteed a minimum wage that is personal to each worker. This wage is called “Genomsnittligt förtjänstläge” (GFL), which roughly explained means that the TAW is guaranteed a certain amount of income independent of how many hours you are hired out during a month. Every TAWs’ salary follows each host company’s average wage level. This means that a the salary of a TAW might vary since they are performing work at different companies, but due to the GFL, the TAW is guaranteed a personal minimum wage. The workers under the LO agreement also have the right to receive a minimum wage each month, even though they have not been assigned to any work at a host company (LO, 2009). This is however not the case for the hourly employees, since they are hired out to the host companies on different premises, but they are still regulated under the GFL (Almega, 2009).Further, according to Almega (2009) the civil servants have another form of guaranteed income. They have the right to receive salary for a minimum of 133 hours a month, and if they work additional hours they receive a special incentive pay. However, the worker is not guaranteed to work these 133 hours, or any specific amount of hours per month for that matter. In summary, despite the protections afforded Swedish TAWs compared to TAWs in many other countries, this special kind of employment still seem to have room for improvement since there are many factors that differ from regular, steady employments.

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1 Introduction
1.1 Background
1.2 Introduction to Proffice AB
1.2.1 Proffice Jönköping
1.3 Problem discussion and Research Questions
1.4 Purpose
1.5 Structure of Study
2 Theoretical Framework, Part 1
2.1 The Temporary Agency Industrial 
2.1.1 Temporary Agency Work
2.1.2 Types of Temporary Agency Employments and Their Conditions
2.2 The Industrial Sector 
2.2.1 Proffice Employees within the Industrial Sector
2.3 De-motivators vs. Motivators
2.4 De-motivators
2.4.1 De-motivators within the Temporary Agency Sector
3 Methodology 
3.1 Research Approach
3.1.1 Case Study
3.2 Selection of samples 
3.3 Research Strategy
3.3.1 Pilot Study
3.3.2 Questioning Techniques
3.3.3 Listening Skills
3.3.4 Initial Interviewing Activities
3.4 Data Collection
3.4.1 Primary and Secondary Data
3.4.2 Interviews
3.4.3 Data Display
3.4.4 Data Reduction
3.5 Validity, Reliability, and Generalizability 
3.6 Criticism to Choice of Method 
4 Empirical Findings 
4.1 Interviews with Managers at Proffice in Jönköping
4.1.1 Unclear expectations
4.1.2 Performance Appreciation
4.1.3 Goals
4.1.4 Communication
4.1.5 Salary
4.1.6 Powerlessness
4.1.7 Belongingness
4.1.8 Clients (Host Companies)
4.2 Interviews with Managers at the Host Companies 
4.2.1 Autonomy and Variety
4.2.2 Communication
4.2.3 Belongingness
4.2.4 Performance Appreciation
4.2.5 Clients (The Host Company itself)
4.3 Interviews with Proffice TAWs within the Industrial Sector
4.3.1 Organizational Politics
4.3.2 Unclear Expectations
4.3.3 Autonomy and Variety
4.3.4 Clients (Host Company)
4.3.5 Communication
4.3.6 Goals
4.3.7 Salary
4.3.8 Powerlessness
4.3.9 Belongingness
4.3.10 Performance Appreciation
4.4 Newly discovered De-motivators
4.4.1 Culture
4.4.2 Job Insecurity
4.5 Summary of Interviews with TAWs
5 Theoretical Framework, Part 2
5.1 Founding Theories
5.1.1 Intrinsic and Extrinsic Motivational Factors
5.2 Herzberg’s Two Factor Theory
5.3 Swedish Culture According to Hofstede
5.4 Motivational Theory Concerning De-motivators within the
Industrial Sector
5.4.1 Performance Appreciation
5.4.2 Belongingness
5.4.3 Communication
5.4.4 Job Insecurity
5.4.5 Autonomy and Variety
6 Analysis and Suggestion of Framework
6.1 Suggested Priority of De-motivators
6.2 Analysis of Found De-motivators
6.2.1 De-motivators connected to Proffice Job Insecurity Communication Belongingness Performance Appreciation – Recognition
6.2.2 De-motivators connected to the Host Companies Autonomy and Variety Performance Appreciation – Reward
6.2.3 De-motivators related to both Proffice and the Host
Company Culture
6.2.4 Remaining De-motivators Clients Salary Unclear Expectations Powerlessness Goals Organizational Politics
7 Conclusion
8 Discussion and Reflections
8.1 Final Comments and Critique of Study
8.2 Suggested Further Research
List of References 


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