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  • Working with Temporary and Contract Employees

    Game Plan

    In-Depth

    Why Hire Temporary and Contract Workers

    Temporary workers are a growing part of American business. According to the Associated Press, some 17 million people work for companies as temps, contract workers, consultants, freelancers, seasonal workers and interns. While the last recession and resulting economic uncertainty initially swelled the ranks of temporary workers, their inherent flexibility keeps them in the forefront of staffing solutions.

    By any other name, temporary employees offer small business owners a variety of benefits, including:

    • A cost-effective way to replace employees who go out on family leave, maternity leave, vacation and sabbaticals. Depending on the type of job, temporary workers may demand higher or lower compensation. However, they don’t usually get company-paid health insurance and other “soft” benefits offered to regular employees. (Some temp agencies offer benefits to longer-tenured employees.)
    • The flexibility to keep staffing levels optimal as your business needs change. Temporary workers help reduce overall staffing costs, because their presence can keep your regular employees fully productive, but not overworked.
    • The ability to “try out” potential future hires. Some companies hire so-called temp-to-hire workers for a trial period to learn if they have the skills and personality a job demands. Temporary agencies usually charge an additional fee when you permanently hire their workers. Even so, some companies prefer this evaluation method to blindly hiring the wrong job candidates.
    • Experience and expertise your company may not possess. Today, companies hire computer specialists, creative people and even senior executives on a temporary basis to fill short-term needs.
    • Well-trained and prescreened capabilities when their staffing agency trains and prescreens them. You can also find the right employee outside of agencies. Highly qualified retirees, for instance, sometime look for short-term assignments.

    Hiring temporary workers isn’t a cure-all. There are times when hiring permanent workers is the better solution. Temps may take more time to get up to speed with company procedures, and they may not possess the same level of loyalty as your regular employees.

    Temporary employees also present potential legal concerns. You cannot, for instance, discriminate against any employee, and every company must provide a safe work environment for all workers. But for the right company at the right time, temporary employees can solve short-term needs.

    Game PlanGame Plan

    Game Plan

    • Talk to an attorney experienced in labor issues before deciding whether to hire temporary employees. Laws and tax rules differ, depending on the type of temporary workers you hire.
    • Check out the Small Business Administration’s overview of hiring temporary workers here.