The number of people using the services provided by private employment agencies (EA) in Armenia is increasing: every tenth Armenian employer uses the services they offer. However, EAs face numerous difficulties, which impede the effective functioning of these extremely important actors in the labor market and stymie the development of this institution.

A 360 degree review: intermediaries with numerous concerns

The EAs mediating between job seekers and employers are mostly small and medium enterprises with one to three staff members. In this regard, they face challenges that are common for SMEs regardless of their field of activity. Among other enterprises they also complain of a large number of different inspections, weak legal regulations and biased treatment of state agencies. Perhaps this fact has motivated EAs to unite in order to protect their rights more effectively. Through a branch of Union of Manufacturers and Businessmen of Armenia (UMBA) were created for EAs, yet EAs face many issues regarding the regulation of the field and self-regulation of their activities.

EAs have a large number of concerns. The current legal culture does not allow for protecting the rights of intermediaries effectively, and the consumers of their services occasionally bypass meeting their own obligations. However, the EAs are not the only party complaining about the faulty regulation of relations between service providers and consumers. Trade unions, for instance, are concerned about the shortcomings evident in protection of employee rights during the process of job seeking. In 2001 the requirement for licensing the activities of the EAs was removed, which, according to the trade unions, has resulted in weakening the capacities of the EAs. On the other hand, the perception of the Armenian authorities and business sector regarding the initiative of bringing back the issue of licensing the EAs activities on the agenda is not unanimous. Some believe that such a procedure will address the issue of proper supervision of the activities of intermediary organizations, whereas some others think that it will push them deeper into the shadow market.

Many EAs provide recruitment services among a number of other services they offer, such as tourism, real estate sales, translation, professional training, etc. Trade unions argue that EAs generally provide employment opportunities that require low or no skills and are low-paid. EAs offer their services to non-professional labor force and almost never offer employment opportunities abroad. Among other issues it should be mentioned also about the confidentiality of their costumers’ personal data and the absence of proper consultancy.

One of the most painful challenges of the labor market is human trafficking. According to some statements, as of today no EA has been accused of trafficking. The organizers of trafficking are mostly individuals rather than registered and legal institutions. However, there is an opinion that temporary work contracts quite often essentially violate the rights of the employees, in the result of which instances of trafficking are not rare both within and outside Armenia. Therefore, to address this challenge the cooperation between EAs, state agencies, trade unions, NGOs and credible international and inter-governmental organizations (IOM, ILO, etc.) is essential. However, all the mentioned stakeholders believe that the level of the cooperation is highly insufficient.

A global labor market, short-handed intermediaries

It may appear strange, but even a superficial study of the Armenian reality shows that the EAs are reluctant to reach out to the field of external labor migration. Perhaps the reasons have to do with extremely limited capacities and either the absent or weak regulation. For instance, the EAs do not have the necessary skills for finding out about job opportunities abroad and cooperating with adequate partners outside the country. No institution attempts to address this lack, for instance, through consultancy or mediation. The Armenian diplomatic missions and consulates abroad are also insufficient in regulating the labor of our citizens. In the result, the activities of the EAs are restricted to the domestic flows of migration. Meanwhile, many issues regarding the organization of labor migration remain unattended.

Long hands for the intermediaries

In terms of regulation of labor migration and prevention of irregular migration and trafficking it is high time to boost the role and capacities of the EAs in providing services to Armenian citizens for finding employment in the international labor market. The significance of this statement cannot be overestimated. As a matter of fact, 94% of Armenian emigrants in the recent years have been migrant workers, and at least one member in every sixth household in Armenia is a migrant worker. Since the pressing majority of migrants leave for abroad either with the support of their social networks or through the mediation of a third person, their rights obviously are rather vulnerable. However, the strong EAs could actually do a huge service to our society, namely, address the numerous challenges related to the protection of the rights of Armenian migrant workers and employment in foreign countries in general.

Armenia has not yet become a signatory to the Private Employment Agencies Convention, signed in 1997 (C181), and though our legislation complies with specific requirements of the Convention, becoming a member will be an additional incentive for further regulation of the field and the improvement of the EAs as an institution.

Signing bilateral work contracts with the EU member-states is one of the key instruments for the development of circular migration and the enlargement of the role of EAs in this process. The environment will be more beneficial after the introduction of biometric documents, approximation of the Armenian regulatory mechanisms to the standards of the EU legislation regarding migration and employment, and introduction of specific mechanisms for providing adequate legal, social and financial guarantees to migrant workers.

The fragile cooperation between EAs and trade unions is still in its initial stage and needs the support and care of the state agencies, civil society and international organizations. Regulation of relations with the diplomatic missions and consular offices, as well as the clear standardization of mutual support for information exchange and other relevant relations will permit to dispel the atmosphere of uncertainty in reaching out to the external labor market and the fear of becoming a victim of trafficking.

However, first and foremost, it is necessary to create a mediatory institution for the intermediaries themselves, which will assist them in the near future to properly access international labor markets, through consolidating and providing information about employment opportunities abroad, building the capacities of the EAs and establishing necessary networks and confidence.

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This paper has been developed based on the opinions passed by the participants of the discussion organized within the framework of the project "Support to Migration Policy Development and Relevant Capacity Building in Armenia". The event took place on December 14, 2009. The roundtable discussion was attended by independent analysts, government officials, and representatives of the international organizations.The project is financed by the European Union.