Koersvast, the Netherlands: Integration into the labour market of people at risk of exclusion – long-term unemployed
Koersvast is a temporary employment agency for long-term unemployed people. The agency recruits workers for jobs at the lower end of the labour market. In the past seven years, the agency placed more than 600 workers in jobs in over 70 companies, which were all small and medium-sized enterprises in a wide range of economic sectors. Despite a changing economic climate and the cessation of regulations encouraging the temporary employment of unemployed persons, Koersvast continues to succeed in integrating people with limited opportunities into the labour market.
Koersvast BV was set up in 1998 as a temporary employment agency specialising in offering recruitment services for long-term unemployed people. At the time, the economic climate was favourable for temporary employment agencies since companies were experiencing a shortage of qualified workers, even though the unemployment rate was high in the Netherlands. In addition, several regulations were put in place to encourage companies to hire people at risk of labour market exclusion. Following the economic recession in 2002, this type of employment was not profitable anymore since the government cancelled all regulations encouraging the temporary employment of unemployed persons. Koersvast was able to overcome this crisis with the financial support of the Start Foundation, a fund directed at innovative projects in the labour market. Start Foundation also took care of coaching the staff to make the company profitable.
In 2006, Koersvast’s workforce comprised one manager and two employees, who were responsible for recruitment, selection of the temporary workers and participating companies, and also two part-time administrative workers. In terms of gender distribution, the agency’s team consists of two women and three men. The company’s annual turnover increased from €600,000 in 2002 to €1.9 million in 2005.
Description of the initiative
The agency has the motto ‘Your partner in socially responsible entrepreneurship’. Client companies prefer to deal with Koersvast in order to recruit workers for jobs at the lower end of the labour market. In the past seven years, the agency placed more than 600 workers in jobs in over 70 companies, which were all small and medium-sized enterprises (SMEs). In 2005, Koersvast placed 251 workers in 29 companies on a temporary basis. With regard to the work placements, the agency recruits for a wide range of different types of work, such as: construction workers, salespersons, assembling workers, operators, administrative personnel, kitchen helpers, car park attendants, (domestic) cleaners, demolishers, waiters and bartenders, security guards and personal care workers. Just under half of the workers recruited by Koersvast are of Dutch origin. The next largest group of workers come from the Antilles or Surinam. Most of the workers are men. In relation to the age distribution of the workers with temporary employment contracts, 15% of these workers are younger than 25 years, 25% of workers are aged between 25 and 35 years, 40% between 35 and 45 years, and 20% between 45 and 55 years. The age distribution of workers with various short-term employment contracts is unknown.
Due to the change in the economic climate, Koersvast has had to evolve from a worker-oriented organisation where the unemployed person is the client to an employer-oriented agency where the companies are the clients. From a social point of view, Koersvast seeks to offer their employees temporary employment contracts for an extended period of time, so-called secondment contracts. Furthermore, it is their intention that employees receive fixed wages instead of working on an hourly basis. However, labour market demands have been changing in recent years, with an increase in the demand for flexible workers. As a result, there has been a shift in the last years to flexible short-term employment contracts. Koersvast takes care of the recruitment process and the selection of personnel. Companies only pay for the actual hours worked, while the agency takes the employers’ risk and is responsible for the payment of wages. Koersvast pays according to collective agreements in the sector.
The Start Foundation has supported Koersvast financially and expects to be repaid through sound entrepreneurship. Moreover, they count on a ‘social return’ as Koersvast should perform above average in their task of integrating people with limited possibilities into the labour market. To measure the agency’s performance in this area, they introduced the ‘Social return on investment’ methodology. To measure the amount of money saved in social security contributions through the activities of Koersvast, the workers were grouped in four categories, indicating their chance of getting hired by another employer. Workers in Group 1 would probably find work in the labour market without the support of the agency, while workers in Group 4 show different kinds of problems and would thus have difficulties in behaving like a ‘good’ employee in terms of productivity, perseverance and social skills. Every category is assigned a weight, ranging from 0% (Group 1) to 80% (Group 4). To calculate the social return, the number of workers in every group is multiplied with the amount of money saved in social security contributions, which is then weighted by the corresponding factor. In 2005, the social return amounted to €499,450.
Koersvast has a large turnover of labour. Their employees are unskilled or low skilled, as well as being socially vulnerable. Most of the workers have large debts. One fifth of the workers Koersvast employs receive a warrant for a hold on wages within eight weeks into their employment contract. As an employer, Koersvast is obliged by law to enforce these measures and withhold wages up to a certain minimum amount. These circumstances do not enhance the employees’ motivation. Furthermore, a lot of these workers have to cope with personal tragedies, such as loss of property, divorce, personal disputes, becoming homeless, substance abuse, health problems and war traumas. In addition, many of them have been cheated by former subcontractors, where expired identity cards and residence permits were issued.
Despite all of these difficulties, Koersvast seeks to find permanent jobs for all of its workers. In 2005, some 15 workers of the 51 with a secondment contract were subsequently employed by the hiring company, seven workers changed to another job, two left the job for health reasons, one chose to pursue further education and 11 were either dismissed or their contract was not prolonged. For the remaining 15 workers, the situation did not change. Of the 200 workers with flexible short-term contracts, 62 workers continued to work with the same type of contract for Koersvast, 38 workers were employed by the hiring company, 32 found other jobs, seven received a secondment contract at Koersvast and 61 were dismissed, disappeared or left for undisclosed reasons.
The agency’s success is due to the good relations with the hiring companies as well as the supervision and support of the workers when being on secondment. Staff members of Koersvast visit the workplaces once a week on average. Most of the companies have been Koersvast’s clients for many years and are open to the concept of socially responsible entrepreneurship. It is obvious that agency staff have to be able to deal with this type of worker. Psychosocial skills are therefore very important when new agency staff members are being recruited.
Exemplary and contextual factors
As a temporary employment agency, Koersvast is exemplary in that it is succeeding in integrating people with limited opportunities into the labour market, despite the changing economic landscape and the disappearance of advantageous regulations concerning its business.
Swenneke van den Heuvel, TNO, Hoofdorp