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Informal and atypical work patterns – what is ‘atypical’ work?

Authors
Chris Engels
Chris Engels
Partner - Belgium
Claeys & Engels
Colin Leckey
Partner - United Kingdom
Lewis Silkin
Greg McGinnis
Partner - Canada
Mathews Dinsdale
Jose Carlos Wahle
José Carlos Wahle
Partner - Brazil
Veirano Advogados
Burkard Göpfert
Partner - Germany
Kliemt.HR Lawyers
Germany
01.04.21
6
If ‘typical’ means full time, permanent employment, what we mean by ‘atypical’ work is every other kind of working arrangement, including part time work with variable hours, fixed term contracts, temping and self-employment.

Atypical work can also include seasonal work, using ‘contingent’ workers, such as those who come to work in agriculture at harvest time – and increasingly, it refers to work within the gig economy. These arrangements are also known as ‘non-standard’ forms of employment. i

It is important to say straight away that just because a working arrangement is ‘atypical’ does not mean it is intrinsically a poorer arrangement than a ‘typical’ one. For many people, it would simply not be possible to join the labour market if it could not be done, say, part-time or flexibly. José Carlos Wahle, partner in our Brazilian firm explains that the atypical economy offers people in his country who would struggle to survive a means to earn a living:

The government has social programmes such as unemployment insurance and benefits for poor families, but they are often insufficient to make ends meet, so we see a wide array of informal work, in street food and snack stands, street markets, plying inexpensive goods and handicrafts, along with metal scrap for recycling.”
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These arrangements have also greatly benefitted parents and others with caring responsibilities all around the world, for example. The entry hurdles for atypical working arrangements tend to be less complicated than for full time permanent jobs, and this has allowed many people to get on the first rung of the ladder. Students and young people benefit particularly from this in terms of getting paid work on their CV. Immigrants and those without higher education often also find they can access work this way. Therefore, as far as inclusion is concerned, the opening up of the labour market to a plethora of work arrangements has been immensely beneficial:

As UK partner Colin Leckey says: “Atypical work provides people with earnings opportunities which are simply not available to them in the traditional economy, for example, through ‘portfolio working’ and simultaneously providing services to a range of end user clients.”

Atypical work arrangements also benefit businesses because of their intrinsic flexibility. Businesses gain the freedom of not having fixed employment costs and this facilitates expansion and reduction in workforce size to meet business demands. Which in turn makes them better able to meet client needs and hire in peak periods, so increasing jobs and employee mobility at those times. It also makes companies more financially robust in downturns, better placed to hire quickly when the market picks up and it gives them access to a larger pool of talent.

Atypical work under the microscope

But some aspects of atypical arrangements have come under fire over the last few years – and the COVID crisis has put them squarely under the microscope. Burkard Göpfert, partner in our German firm, explains the position in Germany:

“There are 2 types of so called ‘mini-jobs’ in Germany: 1) where the monthly gross salary does not exceed 450 euros and 2) “short-term mini-jobs”, for up to 3 months or 70 days a year. People choose mini jobs as they are free of tax and social security contributions. But mini-jobbers are not entitled to unemployment benefits and can only claim a very small pension in old age. This creates a high risk of poverty in old age. In addition, although the employer pays social security contributions for mini-jobbers, they are not covered by health and nursing care insurance. Temporary work is said to integrate the unemployed, increasing their chances of finding more employment afterwards. But it doesn’t always work like that, with many temporary workers finding no employment afterwards. Many companies also use temporary work as a way to increase profits. This makes many temporary workers feel like second class workers, with fewer benefits than the permanent workforce.”

In Belgium, there is broad protection for all workers, but partner in our Belgian firm, Chris Engels, reports that insecurity can be a feature of work on atypical contracts:

“Even if atypical work were to increase significantly in Belgium (which is not currently the case), this would not necessarily lead to a downgrade of employment conditions, as there is a strict level playing field in Belgium, which offers protection for people in atypical employment. Some of the increases in atypical work seem to be by choice, although the most vulnerable workers (e.g. recent graduates, women, those less educated, older and untrained workers) are the ones most likely to feel the negative side effects of atypical work. Research shows, for example, that if temporary work does not result in an employment contract of indefinite duration, this often leads to more instability and a higher risk of poverty.”

Broadly then, the criticisms often levelled globally are that atypical work forms are less well-protected types of employment than standard working arrangements and can lead to insecurity. Primarily, many such jobs are poorly paid and other terms and conditions may also be less secure, sometimes lacking the kind of employment rights that full-time permanent employees would have. There may also be less opportunity for unisonisation in atypical arrangements, meaning people have less of a say in the way things are done. The quality of the work itself could also be poor: it might be repetitive and lack career development or training opportunities, for example. ii

What seems to be the case is that atypical work is of great benefit to some but can lead to greater insecurity for others. So, what are the main differences between those who, on balance, benefit and those who, on balance, don’t?

One difference may be that workers who experience insecurity have less background economic stability. So, for example, having a partner with a long-term stable job and regular income, or a strong support network of family and friends. Many middle-class people have this support in their background, so enabling them to enter into atypical arrangements to no ill-effect – and, indeed, to great benefit. Those caring for children might have this outlook on their job if their family economic situation is supportive. Students also might not care that they don’t have a say in the way a company is organised, for example. They may not need to do very long hours or may not need to keep the job for long.

Another factor sometimes cited is that people need the safety net of unemployment benefits and entitlements to basic state support in times when they don’t have work. Without that, they feel they cannot risk losing their jobs and this could make it harder to complain about terms and conditions, for example. The level of unemployment support varies greatly depending on which country you live in. In some countries there are also complex layers of ‘welfare conditionality’ – in which people can access benefits only if they agree to take the next job offered, whether or not it’s suitable, for example. It is argued that this can trap people in poor quality work, including atypical contracts, out of which they find it hard to progress.

However, it is important to make a clear distinction between ‘atypical’ and ‘poor quality’ work. The two can overlap, but are not the same: atypical contracts do not inexorably lead to poor conditions. As Canadian partner, Greg McGinnis points out:

“Data concerning non-standard work is an imperfect measure for insecurity because it also captures any employment situation that differs from a permanent and full-time job. This broad definition of non-standard work captures self-employed professionals who are in high earning and highly specialised occupations such as information technology, rather than vulnerable workers requiring protection.”

One vital key to determining how people experience atypical work is the workplace culture and we look at the end of this report at how employers can foster a positive culture that supports everyone in the workplace.

"Obviously, long, mutually beneficial, positive working relationships between employers and employees are very important, but they come about first and foremost through workplace culture, having good managers, motivated staff, whose incentives are aligned.”
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References

i ILO, Non-standard forms of employment: https://www.ilo.org/global/topics/non-standard-employment/lang–en/index.htm

ii ILO(2017), The rising tide of non-standard employment, What does it mean for workers? https://www.ilo.org/infostories/Stories/Employment/Non-Standard-Employment#intro