Leasing Employees

T · October 2002

What's the pro's and con's of this?

NaeNae55 · October 2002

Pro: If you choose, you can let the agency do all your interviewing, testing, and background checks. If you prefer to do it yourself, you still reduce the pool of applicants because the agency has narrowed your search for you. You can use a temp and see how well they adapt and fit into your organziation before you worry about hiring (if you have an atmosphere that you don't want messed up, this is a great way to find new employees). Unless you do something really stupid, your chances of being sued for discrimination, etc, are less as the employees are at your workplace for a much smaller time span. You don't have to worry about tax issues, etc. And, unless you keep a temp for a very long time, you don't have to worry about benefits. A temp who thinks he has the opportunity to come work for you full time will do his/her best to impress you with hard work.

Con: Temps often don't have the loyalty and desire to make your organization work that a good regular employee will have. Temps often get stuck with drudgery work and it sometimes begins to show in their attitudes. Sometimes supervisors and other employees don't realize that temps require the same respect and equal treatment that other employees get and you may end up being sued. Often, employees look at temps as ships that pass in the night and won't befriend the temps making them feel even more of an outsider and therefore less loyal, etc. Also, sometimes your regular employees resent you bringing in a temp feeling that you should have paid them overtime or solved the problem by hiring someone on a permanent basis. You may get stuck training idiot after idiot. (In my experience, temps tend to be smarter and have more work ethics when unemployment is high, and just the opposite when unemployment is low.) I once had a temp come in and I asked her to copy a stack of papers. All she had to do was set it in the feeder of the copier (I showed her how), push the button, and bring it back to me after the copier was finished. I went looking for her a half hour later and found her still at the copier. She had half of it done (it was about 100 pages). The part that was done had as many as 5-6 copies of some sheets, and no copies of others. I sent her home.

If you are thinking of using leased employees as a permanent solution, you might want to rethink things. Leased employees have won the right to benefits, etc in case after case in long term situations.

Marie · October 2002

The Pro side is that the employee is employed by both the client and the PEO (Professional Leasing Organization) All administrative reporting, payroll, worker's comp and benefits are provided by the leasing company. Many of the benefits will require the participation of the client company. Basically, staff leasing is an outsourced HR dept. Most often the PEO does not recruit for the client. And there is not a temp to hire arrangement. We require all employees to be leased, the client does not get to have some leased and some regular. Leasing employees allow the client to focus on their core business without the headache of all the administrative burden of employees.

The Con side is that under the joint employer relationship, both the client and the leasing company are ultimately responsible for compliance with all federal, state and local regulations. I personally believe the leasing company is more at risk than the client in these cases, even with an indemnity arrangement in the contract for violation of the regs. If the client doesn't make good on any fines, etc., the leasing company can be held responsible.

Staff leasing is not a temp arrangement. Check with NAPEO for more information.

Leasing Employees

Comments