Just for now: Agency staff bide their time (Photo: AFP)

Niranjan Saha has been working for a nationalised bank through an agency for the last two years. Along with other contract workers at the bank, he had been readying for a retrenchment this December. The agency, as expected, was changed and the contract handed over to a new agency. But to everyone?s surprise, the latter retained the same set of employees ? including Saha.

His job saved, Saha should have been over the moon. But he smelt a rat. He went to court against the bank claiming that it had entered into a sham agreement with a non-existent agency to cut costs. The bank, Saha argues, had to recognise him as their employee for had he been an employee of the agency he would have lost his job when the latter?s contract with the bank expired.

With ?temping? ? as short-term, contract employment is popularly known ? on the rise, legal wrangles such as this have become commonplace. Nearly 50,000 people are now on the rolls of about half-a-dozen temporary-staffing agencies that supply temps to about 200 MNCs and Indian companies. Globally, it is a $200-billion industry with five million people working as temps. Experts believe temping is here to stay as this is being viewed as a part of the liberalisation process. ?MNCs and other big organisations want the liberty to hire and fire, but if they followed this practice at random there could be a lot of heartburn and loss of goodwill. This way they are saved the trouble. Also, it is financially rewarding since they no longer have to carry the workforce when they become redundant. They can get rid of them at a day?s notice,? says D. Bose, director of Quest Consultants.

Temps are indeed pretty much at the mercy of the company they have been hired by. They have no retirement benefits and are usually given lower salaries than permanent employees. Companies can control attrition by drawing up a service-level-agreement (SLA) with the temp company. It can spell out the replacement time, number of hours required and quality of manpower. To keep down headcount they fall back on temping agencies for customer care, sales and IT helpdesk, data entry or consultancy.

So who do temps belong to? The Contract Labour Regulation Act (CLRA) defines ?principal employer? as the entity where the temp is working and not the temping agency. According to a Supreme Court judgment: ?If a set of workers works for the benefit of another then that another is the real employer though there may be some intermediate contractor?.?.

A temp, however, enjoys little job security. Explains lawyer Parthasarathi Sengupta, ?Banks and software companies often float fictitious temp companies that don?t make any permanent recruitment.? But Genius Consultants ? the only company that provides temps in Calcutta ? says that the arrangement works to the benefit of both employers and the employees. ?It is clearly mentioned in the appointment letter that the job is of a temporary nature so we are not taking them for a ride. Also, we make sure that our temps are paid at par with permanent employees,? says Abir Ganguly, national head of outsourcing at Genius.

On paper, temps do enjoy a degree of legal protection. The CLRA says that if a job is of a perennial nature, the government may, by notification, prohibit the employment of contract workers for these jobs. But there is a catch here as well, because core and perennial activities are rarely defined.

Then there is Section 25B of the Industrial Disputes Act that entitles an employee to compensation if he has been working for 240 days. He can claim one-and-half month?s salary from his employer, that is, the agency. Also, an employee who has completed a 240-day tenure is assumed to have completed one year of continuous service that lets him claim permanent employment. To negate this claim, temps are often asked to leave before 240 days.

?The problem is that there can?t be any general rule on this. The law will have to be applied according to the facts of each case,? says lawyer Arijit Banerjee. Even bigger agencies like Genius renew contracts with temps every six months to bypass the 240-day stipulation.

Is there any way to safeguard the temps? interests? Experts believe a couple of simple enactments can change the scenario. ?First, the status of intermediaries needs to be clear. They must provide permanent employment to temps. More importantly, the government can pass a regulation that temps will have to be paid at par with regulars and will enjoy all employment benefits,? explains Sengupta.

But consultants and professionals believe that temping will remain even after the legal ambiguities are sorted out. ?Even if employers have to shell out more, temping will still be convenient for them. It will allow them to operate with a smaller workforce and get rid of employees easily,? concludes Bose.