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Employee leasing is the process of sharing the management of employee-related costs and services between the client company and the staffing company. In employee leasing, a client company and staffing company share the HR functions of a group of employees, either all the employees or just a team.
Sometimes it is just restricted to functions like payroll and training being managed by the staffing company. Sometimes other HR functions, such as compliance, are also handled by the staffing company.
Difference Between Employee Leasing and Temporary Staffing
So, what exactly is the difference between employee leasing and temporary staffing? Employee leasing and temporary staffing can be used interchangeably.
In other words, they mean the same thing. In both employee leasing and temporary staffing (or temp staffing), the workers are leased on a temporary or project basis to the client company.
The employees remain on the payroll of the staffing company. Once the project or the reason for employment is over and the contract between the staffing company and the client company becomes void, the employees are asked to leave. Post this, they may be leased to another company by the staffing agency or asked to wait for a suitable opportunity.
What are the Benefits of Employee Leasing?
Here are some benefits of employee leasing:
1. No need to manage the more taxing aspects of HR
HR functions are both operational and strategic in nature. By outsourcing the operational aspects, such as payroll, compliance, etc., and taking care of the more strategic components, such as recruitment itself, HR can work towards impacting the company’s workplace culture and way of work itself.
They can be involved in workforce management, ensuring that the talent is properly utilized in the company.
2. The staffing company would have the necessary expertise
A staffing company would have been managing payroll and other aspects of HR for a very long period and would have developed methods to resolve most issues that may arise. This makes it very convenient for the client company to let the staffing company take on this responsibility.
Even the strategic aspects of HR (including talent acquisition) could be managed by the staffing company, and the client company could save on HR costs.
3. A contract that is amicable and flexible
At the end of the day, in employee leasing, the contract between a staffing agency and the client company is a flexible one, and the client company can decide what to include in the contract, and if things are not going in their favour and there is a suitable clause that allows it, then the terms of the contract can be changed.
This allows the client company to either take on more responsibilities or relieve themselves of responsibilities later on in the relationship with the staffing company, as much as in the beginning.
You Need a Staffing Partner?
There are several other benefits of employee leasing or temporary staffing, as it is also called. More on that in another blog. Looking for a staffing partner to fully leverage the benefits of employee leasing?
Alp Consulting, with over 25 years of experience in recruitment and staffing solutions, should be your first choice. Give us a call and discover why.
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Rajkumar Shanmugam
Rajkumar Shanmugam is the Head of HR at ALP Consulting, bringing over 19 years of comprehensive HR leadership experience across India and international markets. His expertise spans talent acquisition, employee relations, performance management, compliance, and HR transformation. Rajkumar has a proven track record of driving people-centric initiatives, enhancing workplace culture, and aligning HR strategy with business goals. With extensive experience in US staffing operations and global mobility, he continues to lead organizational excellence through innovation and employee engagement.
