What is Contract Staffing?
The staffing industry is changing, and as a result, direct placement recruiters are turning to contract placements. If you are looking for improved cash flow and improved relationships with clients, contract staffing could be a benefit to your business.
If you’ve only done direct-hire placements in the past, don’t worry! There are many similarities between a direct placement and a contract placement. In both scenarios, you the recruiter get the job order and recruit candidates.
With a contract placement, there is one additional step for the recruiter, and that’s determining who is responsible for the all of the “employer” type tasks and functions. Traditionally, these consist of the employee onboarding paperwork, payroll funding and processing, taxes, insurance, collections, ACA compliance issues, etc. There are two options for these “employer” functions, you can handle them yourself internally, or outsource all of the burden to a contract staffing service provider to handle it for you while you continue to focus on recruiting strategies.
What is Contract Employment?
So what is a temporary contract, anyway?
Before we go into how to offer contract staffing let’s address the question: what is contract staffing? The term contract staffing (sometimes known as contract recruitment) refers to an employment arrangement, where an individual works for one company, but is actually an employee of a staffing company for a specified period of time, to complete a specific task, for a set pay rate. Other common names include: contracting, contingent staffing, just-in-time staffing, outsourcing, flexible staffing, or temporary employment.
In a contract employment situation, there are usually three components.
- The client company. They are the one that has the staffing need. This need is often tied to a specific project or task with a deadline.
- The contractor. They are often referred to as the contract employee and is the worker who is going to perform the task.
- The staffing company. During the placement of the contract worker, they become the legal W-2 employer of record for the contractor and handle things like payroll, taxes, workers compensation, and benefits. Recruiters have the option to handle these administrative tasks in-house or outsource them to a provider of back office support solutions.
Benefits of Contracting for Clients
Industry demand for contract staffing continues to grow because of the benefits of hiring a contractor. Companies utilize contingent staffing for special projects, to evaluate a prospective employee’s skills, to work around hiring freezes, and to respond more rapidly to changing markets. These are just some of the benefits of using contractors.
If your client is having an issue with one or more of these mentioned problems, you may want to suggest contingent workforce solutions as a stress reliever for their business. Here are some other benefits of hiring a contractor.
