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A Study on Temporary, Part-time and Seasonal Employees in Maine
Section A: Authorization for the Study
Senator Neria R. Douglas and Representative Pamela Henderson Hatch of the Labor Committee during the 119th Legislative Session authorized the Department of Labor’s Bureau of Labor Standards to collect the following information:
- The number of "leased" employees;
- The number of temporary, part-time and seasonal workers;
- The typical benefits provided to full-time workers and how they compare with typical benefits for other types of workers;
- What cost employers avoid by hiring temporary employees;
- Why employers hire temporary workers;
- Why employees accept temporary employment;
- Whether any state or federal laws affect the ability to keep employees in temporary employment status; and
- Any other information we believed would help the Legislature understand the nature and extent of temporary employment in Maine.
Section B: Research Methodology
The Bureau of Labor Standards (BLS) initiated contacts with employment agencies, labor organizations, trade associations, research foundations, and state and federal agencies to estimate the number of temporary, part-time and seasonal employees in Maine.
Definition of the employment status under study: Applicable federal and state labor laws were reviewed to ascertain the definitions of the employment groups.
Identifying data sources: Federal, state, private and public data sources were requested and reviewed for data on the employment groups.
Section C will provide legal definitions (if available) and an estimate of the employment data for each employment group.
Section C: Results
Question #1: The number of “leased” employees in Maine.
Definition of a Leased Employee
A leased employee is defined by the reporting requirement under Maine laws, Title 26: Labor and Industry, Chapter 13: Unemployment Compensation, Subchapter II: Administration, § 1082: Powers and duties. The employee leasing company shall provide each of its clients with a list that identifies all leased employees by name, social security number and the wages paid to each employee in the preceding calendar quarter. The Client Company as required under § 1082 (7) shall maintain these records[1].
Using this definition and the records maintained by the MDOL Labor Market Information Services and Unemployment Insurance Tax Division, the data for the number of leased employees is available for the past four years (1996-1999). In addition to the number of leased employees, the Unemployment Insurance Tax Division reported 29 leasing companies operating in Maine with 256 client companies for the year 2000.
The number of leased employees for the past 4 years can be found in Table 1.
Year Reported | 1996 | 1997 | 1998 | 1999 |
---|---|---|---|---|
Leased Employees | 1,086 | 1,443 | 1,527 | 1,657 |
Total Employment * | 444,699 | 444,674 | 467,904 | 481,702 |
* Total Private Sector Employment |
Question # 2A: The number of temporary employees.
Definition of a Temporary Employee
There are no state or federal labor laws for defining temporary employment status.
The number of temporary employees working in Maine can be estimated from the MDOL Bureau of Unemployment Benefits database. Temporary employment agencies as defined by SIC 7363 (Standard Industrial Classification) are required to submit employees’ quarterly wage reports to the Bureau of Unemployment Compensation[2]. Employees working for a temporary agency are accorded temporary status regardless of the number of hours worked.
Using this reporting criterion, the number of temporary employees reported to the Bureau of Unemployment Compensation for the past 6 years (1994-1999) can be found in Table 2. The limitation of this data source is that it does not include individuals who gained temporary employment on their own.
Years Reported | 1994 | 1995 | 1996 | 1997 | 1998 | 1999 |
---|---|---|---|---|---|---|
Temporary Employees | 5,958 | 5,906 | 6,295 | 7,109 | 7,477 | 6,580 |
Question # 2B: The number of part-time employees.
Definition of a Part-Time Employee
The State of Maine has no labor laws for defining part-time employment status. The Federal Bureau of Labor Statistics defines a part-time employee as someone who worked less than 35 hours per week. Data on part-time employees in Maine can be estimated from the Current Population Survey[3](CPS). The Census Bureau conducts the CPS for the Federal Bureau of Labor Statistics. Table 3 describes the number of part-time employees in Maine based on the CPS data.
Year/Population group | 1994 | 1995 | 1996 | 1997 | 1998 |
---|---|---|---|---|---|
16 years and over | 125,000 | 130,000 | 129,000 | 122,000 | 122,000 |
Men | 36,000 | 43,000 | 39,000 | 35,000 | 39,000 |
Women | 88,000 | 86,000 | 92,000 | 87,000 | 83,000 |
Note: numbers may not add up to subtotals because of rounding off |
Question # 2C: The number of seasonal workers.
Definition of a Seasonal Worker
There are no state or federal labor laws for defining seasonal employment status. There are two sources of information that can provide an estimate of seasonal employment in Maine. Under the Code of Federal Regulations, Title 20 Section 655.100, Subpart B[4], the MDOL Division of Migrant & Immigrant Services provides alien worker certification to employers who want to bring in alien workers to perform seasonal work in Maine. These workers are categorized as either agricultural or non-agricultural seasonal workers.
The data presented in Table 4 reflects the number of seasonal alien workers who have been provided certification. The limitation of this data source is that it does not include alien workers who are seasonally employed and do not need alien certification.
Years Reported | 1996-1997 | 1997-1998 | 1998-1999 | 1999-2000 |
---|---|---|---|---|
Agricultural | NA | 803 | 1,154 | 1,704 |
Non-Agricultural | 629 | 325 | 294 | 601 |
Question #3: The typical benefits provided to full-time workers and how they compare with typical benefits for other types of workers.
Definition of benefits
The only reference to employees’ benefits is defined under Title 26 MRS Chapter 15: PREFERENCE TO MAINE WORKS AND CONTRACTORS[5]. These are employers’ payment for life, disability, health, dental insurance, income protection or other insurance programs related to employee health and welfare. Employers have the option of providing a wide range of employee benefits. Once these optional benefits are offered and accepted by employees, the proper distribution and management of such benefits are subject to either federal or state regulation.
Federal or state labor laws mandate that employers provide certain types of benefits regardless of employment status. Typical employee benefits are described in Table 5 and mandatory benefits are described in Table 6.
Federal or state labor laws mandate that employers provide certain types of benefits regardless of employment status. Typical employee benefits are described in Table 5 and mandatory benefits are described in Table 6.
Typical Benefits | Employer’s ontribution | Employee’s Contribution | Regulating Authority |
---|---|---|---|
Health care * | % | % | Bureau of Insurance |
Dental care * | % | % | Bureau of Insurance |
Retirement plan * | % | % | USDOL |
401K plan * | % | % | USDOL |
Life Insurance * | % | % | Bureau of Insurance |
Vacation | 100.0% | 0 | MDOL |
Sick Leave | 100.0% | 0 | none |
Bereavement pay | 100.0% | 0 | none |
Profit Sharing | 100.0% or % | None | USDOL |
* The level of contributions to these benefits varies between employers and employees |
Mandatory Benefits | Employer’s Contribution | Employee’s Contribution | Regulating Authority |
---|---|---|---|
Federal Insurance Compensation Act (FICA) | 7.65% | 7.65% | Social Security Administration |
Workers’ Compensation | 100.0% | 0 | Workers’ Compensation Board |
Unemployment Insurance | 100.0% | 0 | Maine Department of Labor |
The range of benefits received by employees of medium and large private establishments (100 employees or more) is available from the 1997 Employee Benefits Survey[6] (EBS) conducted by the Federal Bureau of Labor Statistics. The Employee Benefits Survey is conducted to obtain information on the incidence and characteristics of employer provided benefits. Table 7 provides a comparison of the level of participation by full time and part time employees in employee benefits programs. The EBS sample covers all private sector establishments employing 100 or more workers. Farms and private households are excluded from the sampling frame. All surveys cover full-time and part-time workers in all 50 states and the District of Columbia.
Benefits by Region | Northeast | South | North Central | West | National Part-Time |
---|---|---|---|---|---|
Paid Time Off | |||||
Holidays | 91 | 88 | 91 | 85 | 40 |
Vacations | 96 | 95 | 95 | 95 | 44 |
Personal Leave | 32 | 18 | 18 | 13 | 9 |
Funeral Leave | 85 | 75 | 87 | 74 | 34 |
Jury Duty | 91 | 88 | 90 | 75 | 37 |
Military Leave | 54 | 45 | 52 | 36 | 9 |
Family Leave | 3 | 3 | 3 | 3 | 1 |
Unpaid Family Leave | 94 | 95 | 92 | 91 | 53 |
Disability Benefits | |||||
Paid Sick Leave | 65 | 54 | 48 | 59 | 18 |
Short Term Disability | 78 | 49 | 59 | 32 | 18 |
Long Term Disability | 42 | 44 | 42 | 46 | 4 |
Survivor Benefits | |||||
Life Insurance | 86 | 88 | 89 | 84 | 18 |
Accidental Death/Dismemberment | 64 | 66 | 71 | 70 | 13 |
Survivor Income Benefits | 2 | 3 | 11 | 4 | * |
Health Care Benefits | |||||
Medical Care | 73 | 76 | 78 | 79 | 21 |
Dental Care | 58 | 52 | 62 | 67 | 16 |
Vision Care | 23 | 52 | 62 | 67 | 9 |
Prescription Drugs | 69 | 72 | 74 | 78 | 20 |
Retirement Income Benefits | |||||
All Retirement | 80 | 79 | 78 | 80 | 34 |
Defined Benefit | 56 | 45 | 54 | 46 | 17 |
Defined Contribution | 52 | 59 | 54 | 63 | 23 |
Savings & Thrift | 36 | 40 | 35 | 46 | 13 |
Deferred Profit Sharing | 9 | 12 | 19 | 12 | 7 |
Employee Stock Ownership | 4 | 4 | 3 | 8 | 1 |
Money Purchase Pension | 10 | 7 | 6 | 8 | 3 |
Stock Bonus | * | 2 | 1 | 1 | * |
Cash/Deferred Arrangements | |||||
With Employer Contributions | 43 | 45 | 46 | 53 | 15 |
Salary Reduction | 42 | 44 | 39 | 52 | 15 |
Savings & Thrift | 36 | 38 | 34 | 45 | 12 |
Deferred Profit Sharing | 3 | 4 | 3 | 4 | 2 |
Other | 3 | 1 | 2 | 3 | 1 |
Deferral of Profit Sharing | 2 | 1 | 7 | 2 | * |
No Employer Contributions | 9 | 7 | 11 | 11 | 4 |
Income Continuation Plans | |||||
Severance pay | 49 | 30 | 32 | 38 | 10 |
Supp. Unemployment benefits | 1 | 1 | 13 | 1 | * |
Family Benefits | |||||
Employer Assisted Child Care | 10 | 8 | 10 | 11 | 7 |
Employer Provided Funds | 6 | 5 | 8 | 5 | 3 |
On-Site Child Care | 4 | 3 | 2 | 5 | 5 |
Off-Site Child Care | 3 | 1 | 1 | 1 | 1 |
Adoption Assistance | 12 | 7 | 10 | 14 | 3 |
L/T Care Insurance | 7 | 5 | 9 | 10 | 3 |
Flexible Workplace | 2 | 3 | 3 | 1 | 1 |
Health Promotion Programs | |||||
Wellness Programs | 39 | 35 | 39 | 32 | 17 |
EAPs | 61 | 60 | 61 | 62 | 36 |
Fitness Center | 24 | 15 | 22 | 25 | 11 |
Miscellaneous Benefits | |||||
Travel Accident Insurance | 46 | 35 | 48 | 41 | 18 |
Non-production Bonuses | 43 | 39 | 43 | 42 | 17 |
Subsidized Commuting | 6 | 3 | 3 | 15 | 2 |
Education Assistance | |||||
Job Related | 66 | 69 | 69 | 62 | 34 |
Not Job Related | 19 | 22 | 22 | 18 | 6 |
Section 125 Cafeteria Benefits | |||||
Flexible Benefits Plans | 13 | 13 | 10 | 14 | 3 |
Reimbursement Plans | 33 | 31 | 31 | 32 | 11 |
Premium Conversion Plans | 6 | 13 | 7 | 1 | 1 |
* Less than 0.5 percent |
Question # 4: What cost employers avoid by hiring temporary employees.
The Bureau of Labor Standards considered an anonymous random survey of members from the Maine Association of Temporary & Staffing Services (MATSS), the Maine Chamber of Commerce and the Maine Merchants Association Inc.
However, due in part to time constraints, limited resources and issues of client confidentiality, this approach of data gathering was not applicable.
Since there are no federal or state labor laws that require an employer to provide the optional typical benefits listed in Table 4, an employer can avoid the cost of not providing these optional benefits regardless of the employment status of their workforce. However, employers are motivated to offer an array of benefits to compete with other employers to attract qualified and productive workers.
Question # 5: Why employers hire temporary workers.
By consulting with the labor and trade organizations and reviewing existing literature, the Bureau of Labor Standards is able to provide a balanced view of why employers hire temporary workers.
The labor organizations (MSEA/AFL-CIO) contend that there are legitimate reasons where employers can benefit from hiring temporary workers. Situations cited are when there is a short-term project, when the work to be completed is seasonal in nature or when employers need expertise on a short-term basis. The labor organizations believe that some employers hire part-time workers for the wrong reasons such as avoiding paying benefits, rotating workers on a long-term basis to avoid permanent status and inhibiting the workers’ ability to join labor unions.
According to the Maine Merchants Association, most firms hire temporaries to address temporary workloads, not to avoid paying benefits.
In a survey conducted by RHI Management Resources [7] , 1,400 chief financial officers reported that the number one reason for hiring temporary workers is to help their businesses handle short-term projects and peak work periods. Other reasons included alleviating employee absences, saving money and avoiding excessive overtime and burnout among regular employees
The American Staffing Association [8] indicated that by hiring temporary workers, companies could get the skills they need to keep fully staffed during busy times.
Question # 6: Why employees accept temporary employment.
There are numerous reasons why people accept temporary employment. The Current Population Survey (CPS) has identified the following two broad categories outlining why people are seeking either temporary or part-time work.
- At work part-time for economic reasons.
This is sometimes called involuntary part-time. This category refers to individuals who gave an economic reason for working between 1 to 34 hours. Economic reasons include slack work or unfavorable business conditions, inability to find full-time work and seasonal declines in demand. Other reasons include being involved in a labor dispute or on maternity or paternity leave. - At work part-time for non-economic reasons.
This group includes those persons who usually work between 1 to 34 hours part-time and for non-economic reasons. Non-economic reasons include; illness or other medical condition; child-care problems; family or personal obligations; school or training; retirement or social security limits on earnings; and being in a job where full-time work is less than 35 hours.
According to the American Staffing Association, many people choose temporary work as an employment option. The temporary workers can select their work schedule and choose among a variety of diverse and challenging assignments. Temporary work can provide workers an opportunity to try out a prospective employer and showcase their skills for a permanent job.
Question # 7: Whether any state or federal laws affect the ability to keep employees in temporary employment status.
There are no state or federal labor laws that would prohibit employers from keeping employees in temporary employment status.
Question # 8: Any other information you believe would help the Legislature understand the nature and extent of temporary employment in Maine.
To obtain more accurate assessment of the nature and extent of temporary employment in Maine, and the types of benefits provided to part-time or temporary employees, the legislature might consider funding a survey similar to the Federal Bureau of Labor Statistics Employee Benefits Survey. An alternative is to request that the Federal Bureau of Labor Statistics conduct a state-specific employee benefits survey.
Acknowledgements
This report is prepared with the assistance of the following:
- MDOL Division of Labor Market Information Services
- MDOL Division of Unemployment Compensation Tax
- MDOL Division of Migrant and Immigrant Services
- Maine State Employees Association/AFL-CIO
- Maine Chamber of Commerce
- Maine Merchant Association Inc.
- Maine Association of Temporary & Staffing Services
- Maine Development Foundation
- The Federal Bureau of Labor Statistics
[1] Title 26: Labor and Industry: Chapter 13: Unemployment Compensation - https://legislature.maine.gov/statutes/26/title26sec1043.html
[2] Title 26: Labor and Industry: Chapter 2: Employer Notices, Records, Contribution and Reimbursement Payments and Reports - https://legislature.maine.gov/statutes/26/title26.pdf
[3] Maine Department of Labor, Division of Labor Market Information Services http://janus.state.me.us/labor/lmis/frdef.htm
[4] U.S. Department of Labor: Title 20 Section 655.100 - https://www.dol.gov/general/cfr/title_20
[5] Title 26: Labor and Industry: Chapter 15: Preference to Maine Works and Contractors - https://legislature.maine.gov/statutes/26/title26sec1308.html
[6] U.S. Bureau of Labor Statistics: Compensation and Working Conditions - https://www.bls.gov/ocs/home.htm
[7] RHI Management Resources: https://www.roberthalf.com/us/en/consulting
[8] American Staffing Association: https://americanstaffing.net/