Employee outsourcing - what is it and is it profitable?

Employer branding

Outsourcing is gaining in popularity. Currently, you can outsource practically everything - from production, through customer service, to accounting. How does this relate to employees? What is employee outsourcing and is it worth using?

Suitably qualified employee team it is the basis of the functioning of every enterprise. Often it is the knowledge, experience and skills of individual employees that determine the company's success. Hiring employees directly is a demanding process. Many employers, wanting to save time and money, decide to use the services of employee leasing.

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What is employee outsourcing?

The word "outsourcing" is an abbreviation of the term "outside-resource-using", which means separating certain functions, tasks or activities from the structure of the company and transferring them to an external entity. In relation to employees, it is the hiring of employees delegated to perform specific tasks. What does it mean?

In the business sense, employee outsourcing is defined as the delegation of HR functions to be performed by an external company. In other words - it is hiring an external company that takes over some of the duties related to the functioning of the enterprise, in this case with the employment and management of employees. An external company searches for and employs employees who perform work for the company. It is worth mentioning that leasing does not apply to the employee himself, but to the work he or she performs. The basis of the contract are therefore specific services to be performed by the employed person.

Who carries out employee outsourcing services?

Employees can be "borrowed" from another enterprise (outsourcing company) or use the services of an employment agency. The second option is more popular. The employer who decides to cooperate with the employment agency is obliged to sign an appropriate contract, under which he transfers some of the duties to the agency. He gives her a power of attorney, thus entrusting her with the management of human resources. 

The recruitment agency deals with recruitment processes from beginning to end - finds candidates, conducts interviews, signs contracts with employees on behalf of the employer and completes all formalities. In addition, he takes care of personnel matters, regulates fees in the Tax Office and the Social Insurance Institution, pays salaries to employees, sends them for periodic examinations, and organizes training for employees. The employment agency may also include the implementation of incentive systems and the provision of mentoring and coaching services.

Who Can Benefit from Outsourcing?

Employee outsourcing is a good solution for large corporations that employ many employees. Massive HR processes take a lot of time, so it is worth entrusting them to an experienced employment agency.

Employee leasing is also a good solution for those companies that complain about lack of employees seasonal or different projects for which they need people with different qualifications.

Why is it worth it?

Using employee outsourcing services can be very beneficial for your business. First of all, it is a great relief for the company. The agency takes over all administrative matters. The employer does not have to recruit, complete all formalities related to hiring new employees or organize training or periodic examinations. Whole The recruitment process and all personnel matters are the responsibility of the agency. It saves a lot of time. The company does not have to worry about formalities, and thus can focus on others areas of company management

Cooperation with an employment agency means access to professional knowledge in the field of HR processes. The agencies employ highly qualified people who are aware of the current trends on the labor market and have extensive knowledge in the field of employee recruitment. The agency, using the skills and experience of its staff, searches for the best, highly qualified employees who do not need to be additionally trained or instructed. The employment of specialists in a given field translates into better functioning of the company.

It is worth mentioning that outsourcing benefits not only the employer but also the employees. First of all, it gives a chance to find the right job, tailored to the competences of a given person. It is a great way to find interesting, prospective work not only by experienced people, but also by those who are just starting their professional career. An advantage in many cases is also the flexibility of working in the positions offered, which allows employees to maintain a balance between work and private life.

People who are looking for work abroad can benefit from the help of an employment agency. The agency will provide accommodation, organize transport and complete all formalities related to employment in another country, which significantly increases the safety of the trip.

Disadvantages of employee outsourcing

Well-conducted outsourcing of employees can bring many benefits. However, this does not mean that there is no risk involved. The biggest disadvantages of outsourcing include:

  • no direct contact between the company and the employee at the hiring stage,
  • no possibility of direct tracking of employee development, 
  • low level of attachment of the employee to the company, and thus the risk of frequent rotation of employees, which may have a negative impact on integration and reduce the effectiveness of professional tasks performed,
  • instability of the employee team and the risk of problems in internal communication between permanent and hired employees,
  • the risk of confidential information leakage outside the enterprise.

Employee outsourcing - summary

Is outsourcing profitable? Undoubtedly, this option is worth considering. This is especially good if the company is involved in various projects or is looking for seasonal workers to carry out specific tasks. Cooperation with an agency that will take care of all issues related to recruitment and employee management is a significant saving of time, which the employer can devote to the development of his company on other levels. Outsourcing allows you to efficiently manage a company without worrying about recruitment processes. It is also a chance to acquire highly qualified employees who can bring a lot of good to the company.

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