Managers use temporary work contracts with hopes of increasing organizational flexibility and reducing labour costs. While academics, non-governmental organizations, and governments have acknowledged the vulnerability of workers in non-permanent work arrangements, they have largely overlooked the potential impacts on permanent employees and organizations. By neglecting these effects, business owners and managers fail to grasp the full extent of the consequences stemming from such personnel strategies.

Job insecurity is by no means limited to those in temporary work arrangements. Actually, extensive reliance on temporary employment can create a climate of job insecurity among permanent workers within a specific organization. One key element fuelling job insecurity among those in permanent roles is the belief that the organization is using temporary workers primarily to save costs or increase flexibility. This can seed a fear among permanent employees that their own jobs could be targeted by these strategies. Such fear breads job dissatisfaction and reduced commitment – two consequences of insecure jobs that are well documented among temporary workers. In fact, research has indicated that permanent employees tend to react more negatively to perceptions of job insecurity in terms of job satisfaction and commitment compared to temporary employees as they tend to have higher expectations of their employers. It is important to understand that this doesn’t just harm the individual – it can ultimately hurt the organization’s overall productivity.

Many people believe that secure jobs are a human right, essential to individual health and well-being. When an organization uses temporary workers to work alongside permanent workers, it may lead permanent employees to perceive that the organization is failing their duty to provide secure jobs. That is, unless it is clear that the organization had no alternative – for situations like covering maternity leaves, long-term absences, or addressing labour shortages. Managers should be mindful that if temporary hires are justified as means to increase efficiency, reduce costs, or enhance flexibility, it could be viewed as poor management, or worse, a lack of commitment to job security. This can increase sense of insecurity among permanent employees and be seen as poor worker treatment.

It is important for organizations to be aware that personnel strategies involving temporary workers come with their downsides – including the potential spill-over effects on permanent employees. The use of temporary workers can create a climate of job insecurity among permanent employees, impacting their morale, job satisfaction, and commitment.