Opportunity and risk for commercial temp in new regulatory "nightmare"

A seemingly minor provision in the 848-page Dodd-Frank Wall Street Reform bill is being called a "logistical nightmare" by some attorneys, but it also just might be an opportunity for commercial staffing firms.

The provision requires U.S. companies to calculate and reveal the ratio between their chief executive's pay package and that of the typical employee.  The higher the ratio, the bigger the PR problem for any company trying to justify its executive compensation.

It's unclear to what degree publication of these ratios will matter--most people are already aware that management is typically very well paid.  But to the degree that it does, it may provide just one more incentive for companies to use outsourced labor such as temporary staffing, particularly on the low end of the pay scale.  Fewer low-paid workers on the books means a more respectable ratio.

There is, however, an alternative scenario that is less sanguine.  If regulators ultimately decide that staffing firms too must calculate this ratio, and must include their placed temporary workers, then commercial temp agencies with hordes of low-paid temps may be made to appear positively Scroogish, not exactly the PR makeover this segment needs.


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