It Takes a Temp : Rise in Contract Workers Poses Special Security Risks

It was another hot, dusty Texas afternoon. Inside the retail warehouse, the temperature was well over 100 degrees. By midafternoon, the crew of temporary workers was clearly fed up with shuffling heavy boxes for a few pennies above the hourly minimum wage.

One man vented his frustration by yelling at the manager. Several others began furtively ramming their forklifts into the boxes, causing untold damage to the appliances inside.

“People were undercutting and undermining the organization whatever way they could,” said Robert Parker, a sociologist who was working on that crew as part of the research for his book on temporary employees, “Flesh Peddlers and Warm Bodies” (Rutgers University Press).

Parker, an associate professor at the University of Nevada in Las Vegas, argues that sabotage and other security problems are a hidden cost often overlooked by managers hoping to trim their budgets and increase work force flexibility by shifting to temporary workers.

No hard data exist to document the increased risks created when managers open their doors to people whose loyalty is to an hourly paycheck, not a corporation.

But based on anecdotal evidence, experts say the dramatic growth in the temporary-help market has created a potentially troublesome avenue for in-house crime. Between 1989 and 1995, the average number of people employed daily as temporary workers more than doubled to 2.4 million.

The problem is particularly acute in areas such as high-technology manufacturing, which is a heavy user of temporary workers and an increasingly popular target for thieves.

One of the hottest black-market goods is the computer memory chip, which is easy to conceal and more valuable than gold.

“There’s a lot of evidence that a lot of the crimes committed by insiders are taking place by temporary workers,” said Mary Lu Korkuch, a manager at New Jersey-based Chubb & Sons, one of the biggest insurers of high-tech companies.

Time, or a lack of it, is one of the villains. Companies seeking temporary workers are usually facing a crisis or a tight deadline that leaves little time for careful preemployment screening. Tough privacy laws also make it expensive and difficult to get information about a potential employee’s work history.

But Korkuch warned employers not to take shortcuts when screening potential employees, even if they’re only on the job a few days.

“People will falsify employment applications and then be given supervisory positions with the keys to the facility or keys to where high-value components are kept,” she said.

Many managers rely on temporary-help agencies to hire and manage their short-term workers. The National Assn. of Temporary and Staffing Services in Alexandria, Va., urges employers to shop around, looking closely at how the company recruits and screens its employees and the level of employee turnover.

Bruce Steinberg, an association spokesman, said temporary employees working with proprietary information should be bonded and are often asked to sign confidentiality agreements.

The good news is that most people--whether they occupy a temporary or permanent place on the payroll--follow the rules.

“Ninety-nine percent of the time people are honest and you don’t need any controls,” said Stephen Vale, managing director of the Los Angeles office of Kroll Associates, the world’s largest security firm. “It’s how you watch and predict for that 1% of the time.”

But even the experts on the dark side of corporate America are vulnerable. Some time ago, Kroll hired a temporary employee in its accounts department. The company later discovered the woman had cashed some old checks stolen from an unlocked drawer.

“You see the same opportunistic crimes,” Vale said. “Checks from the company, property from employees.”

Two decades of experience in the security business have taught Vale that the best protection an employer can buy is not high-tech alarms or key card systems. It’s employee trust and loyalty that will keep people from stealing or motivate them to turn in a colleague who is.

The problem, of course, is that temporary work and loyalty do not go hand in hand. In fact, managers are usually discouraged from developing relationships with short-term workers because it makes it more difficult to let them go at the end of their stint.

“Contingent workers are brought in to meet a specific need at a specific time and let go without notice,” said Stanley Nollen, a Georgetown University professor and author of the book “Managing Contingent Workers”(American Management Assn.).

“You can’t treat workers like that and expect to get in return loyalty or commitment.”

Nollen pointed out that temporary employees have historically been hired into low-end jobs, where access to proprietary information, valuable equipment or huge sums of money is limited.

But the temporary world is changing. Increasingly, companies are hiring professionals on a part-time or contractual basis. Physicians, accountants, ad copywriters and editors are hiring themselves out by the hour.

“We now have executemps, accountatemps; these are all middle-level professionals and higher,” Parker said. “They could do a lot of damage in a short period of time.”

Computers also introduce a new risk into the corporate environment by providing a one-stop shop for everything from proprietary product information and marketing plans to personal financial data.

Vale urges managers to at least do a quick security check before opening their doors to strangers. He said many companies don’t take the time to determine what is valuable and secure it, whether it is a box of blank checks or sensitive client information on a computer database.

COMING MONDAY

Workplace security is just one of many challenges facing managers today. See the Careers special section on Monday for more coverage of management issues.

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Temp Tips

Here are steps employers can take to minimize the risk that temporary workers can pose:

1. Keep your house in order.

Implement financial and information controls, such as locking up check stock and having password-protected computer databases.

2. Examine what tasks temps will perform.

Assign higher-risk duties to full-time employees.

3. Hire through a legitimate agency.

This removes the liability for insurance and other government employment rules from your company.

4. Do background checks.

Make sure the agency checks its personnel. Make your own checks for higher-level assignments.

Source: Stephen Vale, Kroll Associates