Employment seekers are increasingly looking for temporary, contract and seasonal work, according to the Bureau of Labor Statistics.
These days it pays, however, to go into a temporary work situation fully armed with information on how the system works. Sometimes, it makes more sense to avoid temp work.
"When the economy is down, employers are more likely to use questionable employment practices," says David West, executive director for the Center for a Changing Workforce, an organization providing policy analysis on employment issues for temporary, contract, and part-time workers.
Here are a few things to consider before you commit to a temporary, part-time or contract gig.
1. Securing Health Insurance
If you’re looking for temporary, part time or contract work, not many companies will offer you health benefits, or any benefits for that matter, says John Challenger, of executive search firm Challenger, Gray and Christmas.
Temp agencies and staffing firms are often used to fill temporary posts, especially the lower paid positions. Regardless of where you are placed, if the staffing firm is technically considered your employer, you’re paid through the agency and they don’t have to give you benefits, West says.
Some companies, such as like Starbucks (Stock Quote: SBUX), Walgreens (Stock Quote: WAG) and UPS (Stock Quote: UPS) are known for generous benefit plans even for part-timers. Many temporary staffing firms that do offer health coverage only offer it through limited benefit plans, according to West.
“They’ll pay for a few doctor visits and that’s it,” says West. And if you don’t read the fine print on your health coverage, you may not realize that’s all your plan covers, he adds. “It gives you a false sense of security, and if there’s an emergency, your health care costs could put you close to bankruptcy,” West says.
If you’re a worker with special skills and you’re being wooed by a company, you may be able to negotiate for a better benefits package, says Challenger.
But if you are offered benefits they may still be expensive, warns West. If a company does promise you benefits, make sure you get it in writing, West advises.
2. Saving for Retirement
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3. Beware of Non-Compete Agreements
If you’re considering a temporary or contract job handling sensitive information, you may be required to sign a non-compete agreement promising that you won’t take a similar job at a company’s competitor for a certain amount of time, say six months or more.
Such an agreement can be a hindrance if you are actively searching for a position in your industry, as sometimes it is not possible to defer a competitor's job offer.
Non-competes usually affect a small group of higher-wage earners, including software designers or sales people, keeping them from working at a company’s direct competitor.
“You always want to understand what restrictions the company is putting on you, especially if they’re asking a lot,” warns Challenger. They technically can’t restrict take your ability to move very much, however, because non-compete agreements have to be very specifically written and pertain to a specific time frame after you work for a company.
4. When to Avoid a Temp Job
If you’re interested in a temp job, but you can live off unemployment checks or have sufficient emergency savings, you may want to reconsider.
Some workers who on paper are considered temporary or contract workers have been at the same job for years. They’re known as permatemps, and they may go years without health, retirement and other benefits.
Challenger says he usually advises people not to take on part-time, temporary or contract work unless it has full-time potential, or unless it’s absolutely financially necessary.
“Usually taking a part time job deters people’s searches” for permanent full-time work, he says. “It’s important to think about whether the job has the potential of turning into a full-time job. Is it the kind of job you’d want to take full time?”
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