Contract staffing is one of the recruitment strategies where companies recruit talented employees on particular contracts that mention the requirement and terms of their agreement. The agreement is designed in a manner where candidates are expected to work for a certain project till its completion or set duration of time.
In the early decade of 1940 when world war – II was at its peak, the western allied force was facing one of the biggest problems in terms of scarce manpower, as a large number of employees vacated their office and joined the armed force to serve their nation. So, to counter the shortfall of the workforce, staffing agencies came up with the idea of “Contract staffing”. The contract staffing solutions served the purpose of countering the shortfall in administrative work & temporary work which were required in high numbers back then. Over time evolution happened in staffing happened and is now in almost every sector with highly specialized skills & knowledge positions.
Contract staffing is used as the very alternative for the recruitment of any permanent full-time employees, permanent part-time employees, Casual employees (a.k.a Daily wagers), or independent contractors
How does Contractual staffing work?
Nowadays businesses regardless of their respective industry, sector, or size always need to explore innovative & new methods to manage cost, process & recruit suitable talent. Employers also face difficulties with skilled & proficient candidates because hiring the wrong candidate might leave the company entirely unsatisfied and impacts the business operations, goodwill & also incur high cost for the company.
Globalization has led to an extremely dynamic & quick paced business environment. It has become very tough for the business houses to anticipate the resource that is required to sustain operation and hence the hiring patterns have been reshaped. To overcome the challenges businesses have started using contract staffing instead of traditional hiring.
Contract staffing working
The contract staffing process starts commonly with the organizations stating to hire skilled professionals to work on short-term projects which make both parties in the contract, so staffing agencies can help them to recruit a few candidates by sourcing, screening & interview efforts.
Right when the candidate is selected, a contract is signed between the staffing agency & professional who is recruited. The agency offers remuneration & compensation for the resource that has been hired because of the relationship between the organization & staffing agency.
The major reason to prefer Contract staffing
1. No Risk: – hiring someone new can posses a risk to an organization as they are not aware of the past project experience, knowledge, and understanding of the work process, etc. Any bad recruit can cause the organization a significant monetary loss with the loss of projects, and harm to the reputation, as permanent employees of such candidates can be a liability. And to avoid such trouble organization contacts staffing agencies which can provide the eligible candidate to work for them for a certain period.
2. Resilience: – Staffing challenges can arise because of a lot of factors like business growth, merger & acquisitions, the introduction of new technology, the demand cycle & others. In such a scenario preferring to go with contract staffing helps. A business organization can also integrate temporary workers who provide additional support and can infuse important knowledge into existing employees to help to grow productivity & skills.
3. Highly trained & skilled talent pool: – sectors that are highly technical like IT, automation, Accountants, etc. can hire professionals on a contractual basis, so they can pass knowledge of project-based experience. Even though traditional hiring gives years of experience but it leaves out the benefit that contractors possess. Shorter job stints & more focused projects than the overall organization enable the contractual manpower to use niche experience without long-term commitment like salary. Hence contract staffing is a better method than traditional recruitment for the project-based initiative.
4. Trial run: – Many times, candidates with suitable skills and experience but with personality differences from other members of an organization end up affecting overall productivity and might bring down the entire team’s efforts. Contrary contract positions enable candidates & companies to test each other before full-time employment.
5. Flexibilities: – Contractual staffing empowers an organization with the ability to react suitably towards market changes & business requirements as & when required. It also offers flexible coverage for any requirement in the project which is required. No job security is the common misconception associated with staffing, however with help of contracting it is possible to choose the work environment & projects they want to participate.
6. Short-term business needs: – Contract staffing is extremely beneficial in fulfilling the business’s short-term needs as they provide a certain amount of time without assuming any responsibility. Contract staffing services also hire candidates to do short-term projects like 3, 6, or 9 months projects in a company
7. Efficient management: – General management of employees is no longer concerned as it is taken care of by the contract staffing agencies. Everything falls on the staffing agency to check background, screening, interview, and reference checks. Many times agencies can test the professional for some time. In case the selected candidate does not seem to work out then there is also an easy way to terminate the contract. This helps the organization to manage its business effectively as well as efficient management of candidates is done by staffing agencies.
Various Services offered in Contract Staffing
Apart from recruitment, contract staffing services include various other services
- Recruitment or selection from an existing employee or appropriate candidate for the client company as per the project or organizational requirement raised.
- Contract provision is there which is compliant with the employment or the service expected, aligned with the work or project requirement of the client business
- Contract staffing company manages the payroll for the staff as well as the social contributions and benefits to which the candidate is entitled as per the legal provision.
- Staffing agencies also deal with employment disputes if raised, also work with the renewal and termination of the contracts
- In certain offshore contractual projects, documentation and legal application for the required visa are done on behalf of the candidate.
- Taxation part of income for the candidates is also taken care of.
All the above gives us a brief understanding of what contract staffing really is.