Lithuania>: Temporary agency work and collective bargaining in the EU

  • Observatory: EurWORK
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  • Published on: 18 Diciembre 2008



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In Lithuania, there has been no legislation governing TAW. There is a Draft Law on Temporary Agency Work that has been submitted to the concerned parties for consideration. The social partners have been failing to reach an agreement as to the strictness of regulations imposed by the law: employers seek more liberal regulation of temporary agency work, while trade unions prefer stricter regulation thereof. As long as the sector is not formally “legalised”, there is no statistical information to be used for the assessment of the sector. However, we can say that the phenomenon of TAW is not manifesting on a large scale in Lithuania.

1. Definitions

1.1. Statutory definitions

Drafting of a law to regulate temporary agency work was started in 2004. However, the law has not been adopted so far. On April 2008, the Draft Law on Temporary Agency Work was submitted to the concerned parties for consideration. The Draft Law contains the following definitions:

Temporary agency work – activities of a temporary work agency involving employment of temporary workers with the view to placing them for temporary work under agreements for temporary agency work for the benefit, and under the lead, of temporary work users.

Agreement for temporary agency work – an agreement between a temporary work agency and temporary work user, whereunder the temporary work agency obligates itself to assign, for a certain consideration, performance of jobs stipulated in a temporary work agreement to temporary agency worker or workers for the benefit, and in compliance with the work procedure, of the temporary work user, and the temporary work user obligates himself to ensure work conditions for the temporary agency worker or workers in compliance with the law and this agreement.

Temporary agency worker – a worker who has entered into a temporary work agreement with a temporary work agency.

Temporary agency work user – a natural or legal person, which may qualify as an employer, to whom a temporary agency worker is temporary subordinated under an agreement for temporary agency work and temporary performs job functions stipulated in a temporary work agreement.

Temporary work agreement – a work agreement between a temporary work agency and a temporary agency worker, whereunder the temporary agency worker undertakes to perform job functions stipulated in the work agreement for the benefit, and in compliance with the work procedure, of the temporary work user indicated by the temporary work agency, and the temporary work agency obligates itself to pay the agreed wage, compensations, daily allowances, travel allowances and other allowances due to the temporary agency worker as well as to fulfil other obligations stipulated in the Labour Code, Law on Temporary Agency Work and temporary work agreement.

1.2. Collectively agreed definitions

Temporary agency work is not mentioned in any of national/sectoral collective agreements and therefore there is no collectively agreed definitions of temporary agency work, agency worker or user enterprise.

1.3. In your country, would you describe TAW as a sector in its own right?

It is very difficult to answer this question unambiguously. Like in 2004, TAW is still underdeveloped in Lithuania, legal framework has not been prepared so far and few people (employers including) are aware of temporary agency work. This gives grounds to maintain that TAW could hardly be recognised as a sector.

On the other hand, the concerned parties - Ministry of Social Security and Labour (Socialinės apsaugos ir darbo ministerija, SADM), social partners – peak employers and trade unions organisations – at the Tripartite Council of the Republic of Lithuania (Lietuvos Respublikos trišalė taryba, LRTT), Transient placement companies’ association (Laikino įdarbinimo įmonių asociacija, LIIA), and scientists have been discussing the concept of temporary agency work and attuning the Draft Law on Temporary Agency Work for 4 years. This presupposes that among relevant experts TAW is conceptualised and approached as a sector in its own right and a special legal framework is being built for it.

2. Regulatory framework

2.1. Have there been any changes in the law concerning TAW since 2004?

In 2004, there was only a decision to draft a special law. Currently the draft is prepared and considered by the social partners, though valid legal framework regulating TAW is still absent in Lithuania.

2.2. How is TAW regulated in your country?

a) Is there a legal framework specifically for TAW; and/or is it covered by general labour law (including case law/ jurisprudence)?

b) What is the role, if any, of collective labour agreements and self-regulation?

As no legal acts regulating TAW have been adopted, the situation has not changed since 2004: there is no legislation on temporary agency work, at the same time this form of work has not been banned by legislation. There are no restrictions, no licensing, no limitations of the use of TAW. As there is no legal framework on TAW, there are no temporary work agencies in Lithuania either and the firms actually engaged in staff lease have to document their activities as provision of different kinds of services.

Collective labour agreements and self-regulation do not play any role in this sector.

2.3. What is regulated in these provisions? In particular, does it cover:

As no legislation regulating temporary agency works has been adopted, we cannot answer the questions below.

a) use of agency work (e.g. length of assignment, sectoral bans, permitted reasons of use, number of agency workers per company, other)

b) the form of the contract (e.g. project, fixed-term, special contract, open ended, etc.)

c) social security and social benefits

d) conditions to open a TAW agency (e.g. license or authorisation schemes, supervision by public authorities, financial requirements, or others - please specify)

e) business activities/services delivered by TW agencies (e.g. prohibition to provide other services than TAW)?

f) third-national companies or temporary agency workers (e.g. activities of foreign agencies)?

2.4. Do any regulations (by law and/or collective bargaining in the TAW sector) specify equal treatment rights for agency workers with permanent workers in the user enterprise concerning: a) pay, b) training, c) other terms or conditions of employment?

As there is no legislation governing TAW in Lithuania, workers who actually are temporary agency workers are applied the same regulatory framework as are any other workers employed under employment contracts.

2.5. Do TAW workers have the right to information, consultation and representation?

As there is no legislation governing TAW in Lithuania, workers who actually are temporary agency workers are applied the same regulatory framework as are any other workers employed under employment contracts.

2.6. Is there a control/enforcement mechanism regarding any TAW regulation?

No.

2.7. Are there any procedures governing use of TAW and strike breaking?

As already mentioned in the previous report, in Lithuania there are only a few enterprise-level collective agreements where the term agency work is mentioned (agency work here is defined as work when one enterprise sends its employees to work or provide services for another enterprise who it has concluded an agreement with on the provision of civil services). Those collective agreements specify that it is forbidden to use agency work in order to replace the employees who are on strike or the employees who were fired as a result of job reduction. A similar wording is provided in the Collective Agreement Model developed by the Lithuanian Trade Union Confederation and published by the Ministry of Social Security and Labour: ‘it is forbidden to use agency work in order to replace the employees who are on strike, when the jobs are related to hazardous, very hazardous or dangerous factors, or to replace the employees who have been dismissed as a result of job reduction unless six months have elapsed after the dismissal. The employees working under such agreements are covered by the CA.

3. Social dialogue and collective bargaining

3.1. Is there any employers’ association(s) for TAW firms in your country?

In 2007, seven Lithuanian temporary work agencies established the Transient Placement Companies’ Association (LIIA). Today, there are 12 member companies in the Association. It is the first and the only body joining temporary agency work practitioners in Lithuania. The Association actively participates in the formation of regulatory framework for TAW and facilitates market players to use the services of agency work.

3.2. Is there any union(s) specifically for agency workers?

In Lithuania, there are no unions or confederations targeted at the recruitment of agency workers. However, as agency work is not governed by laws, there are certain groups of workers (e.g., workers of enterprises providing security services) in Lithuania that would probably be attributed to TAW in the event a legislative niche is created for them. Workers of such companies are members to sectoral trade unions or confederations of trade unions, but they are not qualified as agency workers.

3.3. Collective bargaining levels

a) intersectoral/national level?

As long as a legal act governing TAW is not adopted, central discussions on the future of TAW take place at national level. The Concept of Temporary Agency Work was designed by the SADM in 2005/2006. On April 2007, this concept was considered by the social partners at the LRTT, who basically agreed on the need to form a working group for drafting the Law on Temporary Agency Work. This working group (comprised of representatives of employers, trade unions and public authorities) was formed in 2007, and the same year the draft law was prepared. Currently (first semester of 2008), the draft law is considered by individual stakeholders. It is quite probable that the social partners at national level will come back to this issue in the nearest future.

b) the sectoral level for TAW?

No.

c) company (ie. temporary agency firm) level?

No.

3.4. Collective bargaining outcomes

There are no collective agreements governing TAW in Lithuania. When discussing the future of TAW, trade unions speak for a stricter regulation of temporary agency work, while employers, and LIIA in particular, seek “milder” regulatory framework (for example, to exclude a requirement to employ workers under non-term employment contracts, etc.).

3.5. Are there any examples of sector- or company-level collective agreements in other sectors that restrict, permit or otherwise regulate the use of TAW within their domain?

See Chapter 2.7.

3.6. Please provide any data concerning

a) trade union density for agency workers

b) the coverage of collective bargaining within the sector.

Companies qualifying themselves as transient placement companies (temporary work agencies) do not have in-home trade unions, and no collective bargaining takes place. Accordingly, we can say that both trade union density and coverage of collective bargaining within the sector equal to 0. On the other hand, if we attribute to TAW workers of certain professions (e.g., security workers), who have joined trade unions, trade union density and coverage of collective bargaining within the sector would probably account for less than 5%. However, as long as TAW is not ‘legalised’ in Lithuania, it is difficult to judge on actual coverage of workers by the TAW category.

4. Employment and working conditions of TA workers

4.1. Please provide the most recent data (averages) on TAW employment

a) longevity of TAW employment, i.e. how long workers remain employed

- in the sector?

- with a particular agency?

b) duration of TAW placements, i.e. the length of assignment in a user company.

As TAW has not been “legalised” in Lithuania, there is no statistical information as to the longevity of TAW employment and duration of TAW placements.

4.2. Please provide any evidence from official, academic and social partner sources concerning:

a) the reasons for user companies’ usage of TAW, including any differences by sector, occupation, firm size etc.

As it was mentioned before, there is no statistical information in Lithuania giving grounds for more or less precise assessment of the actual situation in the sector. Basing on articles in press and interviews with some social partners, we can say that temporary agency workers are usually used by companies engaged in seasonal business activities. Temporary agency workers are also used during various trade campaigns (during Christmas, Easter seasons, etc.). Temporary agency workers are often employed to substitute for employees who are on sickness or childcare leave. According to experts, specific businesses using temporary agency workers are logistic companies and entertainment organisers.

b) reasons for workers participation in the sector and levels of satisfaction, including any differences by age, sex, education etc.

Like in the case above, basing on articles in press and interviews with some social partners, we can say that students account for majority of temporary agency workers in Lithuania; elder individuals and women with children account for the fewer number of them. According to experts, in Lithuania most of temporary agency workers are unskilled workers often doing simple jobs, such as warehouse keepers, stevedores, workshop workers, cleaners. On the other hand, there are managers and entertainment organisers among them, too.

4.3. In practice, which rules and procedures may apply to temporary-agency workers in contrast to other workers in the user company?

As there were no surveys carried out in this area, we can only base on public debates of the social partners. According to employers, efforts are taken to create normal work conditions for temporary agency workers, i.e., they are not assigned to more difficult, more risky or less attractive jobs. Though there is no reliable information as to the payment to temporary agency workers, according to LIIA’s representatives, efforts are taken to formulate such an employers’ approach that temporary agency workers are not cheaper, i.e., they should not be paid less than other company’s staff doing analogue jobs. On the other hand, according to the employers, it is naïve to expect the employers to make equal investments to temporary agency workers and to permanent staff members (i.e., as concerns their training, social and health care, etc.).

5. The extent and composition of TAW.

5.1. For 2004 and 2007, please state

a) the number of agency workers

b) total revenues of the TAW sector

As TAW has not been “legalised” in Lithuania, there is no statistical information as to the number of agency workers and revenues of the TAW sector. Speaking about a period from 2004 to 2007, we should say that this period was outstanding for constantly increasing shortage of labour force in the country. Under such a situation, the demand for temporary agency workers should be obviously growing. Yet, there is no information as to the current number of agency workers or total revenues of the TAW sector.

5.2. What proportion of the TAW workforce is currently

a) male/ female?

There is no reliable information as to the distribution of agency workers by gender.

b) full/part time?

Basing on employers’ interviews and their press reports, we can say that the absolute majority of agency workers are part timers.

c) young (<c. 25) or older (>c. 50) workers?

Basing on employers’ interviews and their press reports, we can say that most agency workers are young individuals, some of them – pre-pension age.

5.3. Has there been any changes to the TAW sector in terms of

a) concentration, i.e. proportion of employees or turnover accounted for by the largest firms?

There is no reliable information as to the TAW concentration, however from interviews with employers we may say, that conversely – recently the number of firms is growing, not concentration of employees in larger firms.

b) internationalisation, i.e. number/significance of multinational TAW firms?

It is difficult to assess precisely the proportion of multinational firms in Lithuanian TAW firms. Yet, basing on expert examinations we can assume that multinational firms may account for up to 50% of all TAW firms at least.

5.4. What is your evaluation of the availability and quality of statistical data concerning TAW in your country?

As it was mention before, as long as TAW activities are not “legalised” in Lithuania, it is hardly probable that any statistical information about TAW as a sector will be collected. There have been no more significant surveys in this sector due to its small scale. Therefore, the sole source of information about the sector is occasional expert-type information provided by the LIIA.

Commentary by the NC

Today, the key problem concerning TAW is consideration of the Draft Law. The Draft Law has already picked numerous comments on the part of the social partners. Commentaries are still coming, so it is difficult to summarise them at this stage. However, we can already say that employers (particularly, temporary work agencies united by the LIIA) are seeking and will be seeking for more liberalisation of these activities. On the one hand, they need legislation regulating TAW in order to transact their business. On the other hand, they seek to minimise provisions restricting activities of TAW firms (for example, to avoid such requirements as to pay wages to temporary agency workers for a time when they are not working, to pay them equal remuneration for work as compared to permanent staff members, etc.). However, trade unions are seriously concerned that more liberal law may negatively impact on both agency workers and permanent workers, who will be more and more often substituted by temporary agency workers.

Inga Blaziene, Institute of the Labour and Social Research

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