I was earning QPS Employment Group a lot of money — about $7 out of every $20 Saputo paid them for my services as a cheese packer — but someone at Saputo drank sour eggnog and decided I would be a suitable target for their wrath.
After all, Saputo had paid an hourly premium, just for the luxury of having the option to terminate me at any time and without due process. Contrast this with the lot of those fortunate to receive a permanent contract immediately, without -any- temping: The need to document the worker’s mistakes before dismissal; the need to allow a certain number of absences before punishment; and other ameliorations of the otherwise one-mistake-and-you’re-done, unless-we-really-like-you world of at-will employment.
These are protections that direct hires have from Day One — which begs the question as to why Saputo doesn’t force -all- their packaging workers to be permatemps before a job offer, as they had specifically required from me as a condition of my work there.
Anyway, this disruption has unlocked my creative powers: I’ve been writing prolifically offline, but have yet to edit the material into the perfect rendition for sharing online — such as this very blog article about the economics of staffing agencies. (And yes, I’ve much more to say about Saputo — but am busy filing for unemployment benefits; continuing my crusade for higher-education reform; and otherwise planning what’s next.)
Now, I’m not here to badmouth QPS: After all, everyone at QPS wanted Saputo to continue my assignment, so that I could keep earning QPS the equivalent of one-third of my paycheck, i.e. $7 out of every $20 Saputo paid QPS hourly.
Cue QPS and its oft-claimed defense, “Oh, but we don’t take from anyone’s paycheck!”
While that might be legally true, it is practically false: The only difference between taking a share of one’s paycheck — such as through a surcharge or special tax — and reducing their up-front wage is how the under-cutting of take-home pay is structured.
“Job clients,” such as Saputo, pays the same (or higher) hourly rate to the staffing agency. The worker is the one who ends-up with a small piece of the piece, because his or her wage is reduced by the difference between what Saputo pays a new hire and what QPS pays me — a temp, not a hire — after QPS skims its portion of whatever Saputo pays it.
(As will be shown mathematically, this loss of wages — from being denied a direct hire and needing to permatemp — is about 5 dollars per hour, or $10,400 annually. Unfortunately for Saputo, few of their recent direct hires have shown greater performance or punctuality than the “disposable temps,” whom they nickel-and-dime in various ways and hold to double-standards on nearly every dimension.)
The fact is that when an employer pays a staffing agency for any “contingency worker,” that is money that would have instead been paid to that worker if s/he had instead been a direct hire. Staffing agencies make their livelihood through this economic vampirism.
Yes, the “job client” — in this case, Saputo — decides whether to pay the full wage to a worker (by allowing that employee to be a direct hire) or to pay some of that wage to the staffing agency (thereby removing a portion of the worker’s take-home pay).
However, the fact that Saputo pays such a large portion (more than one-third) of the hourly wage to the agency account representative — instead of 100-percent directly to the worker — means the agency worker -is effectively robbed- of that portion of the wage.
Mathematically, this is the difference between the direct hire’s higher-than-agency-worker starting pay and the agency worker’s lower-than-direct-hire starting pay. In my case, Saputo paid $20 hourly to my agency overlords at QPS; QPS kept $7 of that hourly pay; and this left me with only $13 hourly, which is $5.49 lower than the $18.49 hourly starting wage for Saputo’s Reedsburg packaging employees.
“Yeah, but we don’t take it from your paycheck! (We just take it through a service-level agreement -before- formulating your paycheck.)”
QPS can deny this discrepancy all it wants, but that wage difference -did- come-out of what would have been my paycheck as a direct hire. Intercepting that money -before- it becomes a payroll item is mere slight-of-hand, the same kind of accounting trick that got Enron, Mitsubishi, and other large firm into huge scandals that diminished their reputations for decades thereafter.
Add this-up over the course of a year, and that means QPS is “earning” (skimming) $13,867 annually -just- for providing the option for anytime, due-process-free termination. It’s basically the same thing as a wage garnish, except applied before any money changes hands: The garnisher simply agrees with the garnishee’s employer (Saputo, without whom QPS would not have a job assignment to offer) that the garnishee will be underpaid, such that the skimmed-off portion of the wage will be paid directly to QPS instead of to me.
Indeed, QPS Employment Group was paid -only- for providing a walk-away option to Saputo: QPS itself never did any “work coordination” because scheduling was -always- between me and the supervisor. (And I never saw any benefit from permatemping, as QPS wages and benefits pale in comparison to a direct job offer from any of the so-called “job clients” where job assignments can take place indefinitely, without any on-boarding timeline.)
Furthermore, I had negotiated my transition from part-time “fresh line” worker into full-time “packaging” worker! QPS was riding my coattails, and more-or-less conceded as much when my “work coordinator” authorized me, in writing, to negotiate whatever type of job placement I could with Saputo Cheese (at the Reedsburg plant or elsewhere).
Also underscoring QPS’ trivial justification for its perpetual wage-skimming (or whatever QPS calls it in the legalese of its Saputo-side labor contract) was that by the time my contractual hours had approached exhaustion, QPS proved powerless to make Saputo correct its hostile work environment or to make Susan Felson follow-up with the uniform she “had ordered” a month before my termination.
Meanwhile, Saputo would have paid -the same- amount in total if they had hired me directly; whereas, I would have grossed $41,600 instead of only $27,733. It really seems that Saputo “had it out” for me from the start, due to allowing me to work there -only- if I were to be exempt from union protections by artifice of having the staffing agency as the middleman employer-of-record.