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Body leasing is a widely recognized and well-established method of high-level team building and top management.
Foremost, let’s decide on terms
In recent years, many new approaches have appeared in the practice of hiring staff, and some old ones turned out to be profoundly rethought. So, if earlier the concept of “leasing” was earlier applied only to equipment, today, renting highly qualified employees has become a universally recognized way of forming commands to perform time-limited tasks. The body leasing services market is constantly and steadily growing, increasing annually by one and a half times. The total turnover of the body leasing and team leasing companies exceeds $60 billion per year. Approximately 1% of the working population of the planet is currently looking for and finding work through such structures.
In addition to such well-known forms of hiring workers as body leasing and team leasing, there are other ways to interact with the employer and contracted employees. In particular, outsourcing and outstaffing. Although considering these practices is not the topic of this article, let’s briefly get acquainted with what exactly these terms mean and how such approaches differ from body leasing.
- Outstaffing is, in fact, a solution for the legal optimization of taxes and personnel policy of the company. This approach is based on a scheme in which employees of one company are officially listed as working in another, usually called a provider. The provider company maintains all personnel records and pays mandatory contributions, including ones to pension funds and salaries, to these employees. At the same time, the provider may not even know what these “their” employees look like, since they work in another company.
- In contrast to outstaffing, body leasing, and team leasing, outsourcing is a practice that has been known and actively used in various fields for over a dozen and, most likely, even hundreds of years. The principle of outsourcing is that you, as the head of the company, transfer some non-core functions (for example, security, logistics, and cleaning of your office) to another performer. It can be a specific narrow-profile company (for example, specializing in accounting or providing security services) or a big multi-profile agency. In this case, it does not matter to you who strictly performs this or that work because you enter into an agreement that guarantees you a specific result by outsourcing certain tasks. Accordingly, the entire responsibility for its achievement lies with the contractor.
- Body leasing is fundamentally different from the above two approaches because, in this case, you attract a specialist of a particular qualification (often a highly qualified expert) who either becomes part of your own team for a while or turns into one of the links in your technological chain. At the same time, the company providing you with such an employee assumes many obligations both to you and to him. You are guaranteed the appropriate qualifications of the employee involved under the body leasing contract, as well as the absence of downtime (in case, for example, the illness of such a specialist, you are immediately provided with an adequate replacement). As for the employee himself, the leasing company provides him with official employment, payment of wages with all mandatory contributions to various funds, and social guarantees listed in labor legislation.
- Team leasing is a form of body leasing. But in this case, you receive from the leasing company not an individual specialist but a whole team with specific qualifications which is able to perform one or another (usually relatively short-term) task.
When body leasing is the most effective solution for your company
Once again, we need to emphasize the specifics of the relationship between the three parties – a temporary worker, a leasing agency, and a company that gets this worker on a body leasing base. This clarification is significant in the context of our conversation. Leasing agencies, and sometimes entire recruiting companies, find and hire people who are ready to work temporarily and then offer them as their employees for rent to other companies interested in certain specialists for a particular time. Thus, the customer receives personnel with whom he has almost no legal connection. The personnel recruiting agency is responsible for the work of the provided persons. The leasing company makes all settlements with personnel and the tax authority.
The advantages of this method of attracting personnel with specific qualifications are apparent. On the one hand, the head of the company promptly satisfies his needs for workers necessary to complete a time-limited task. This task can be anything from seasonal fruit harvesting or expanding restaurant staff during the peak tourist season to developing unique software or maintaining a network in your new office.
A contract with a leasing agency guarantees that you will receive precisely such employees who will ensure high-quality and timely fulfillment of the tasks assigned to them. At the same time, you get rid of the routine associated with establishing and formalizing new labor relations and the inevitable additional financial losses in this case.
On the other hand, you should remember that the involvement of body leasing contracts to employees implies the payment of a commission to a leasing agency. As a rule, the amount of such fees is 20% of the salary of a temporary employee. Therefore, when deciding to contact a leasing agency, you must first carefully study the economic feasibility of concluding such a contract.
The attraction of body-leased employees has another advantage, maybe, not evident at first sight. Thus, you can comprehensively study the temporary employee, evaluate his qualifications and human qualities, and offer him a permanent job in your company if everything suits you. Therefore, you actually provide him with a trial period. Still, at the same time, you do not carry any obligations provided for such cases by labor legislation (for example, a ban on dismissal before the end of the trial period).
Body Leasing may be an ideal solution for your company if you need employees of a specific qualification for a limited time. But, bearing in mind the payment of commissioning leasing agencies, you should weigh all the economic pros and cons before approving such a decision.
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