Staff leasing formally is a business service where one legal person – job intermediary/consultant provides to another legal person – client/user,  the service consisting of staff hiring, with the purpose of lending the staff for execution of a certain job for certain reward. This service is a flexible solution for the employing companies that need new employees, but do not wish to or are unable to hire them permanently as internal staff. The reasons for this could be different – legal restrictions, corporate policies, as well as optimizing certain activities through outsourcing of non specific activities. The leasing companies hire employees on behalf of their own name and on their staff listing for the company who orders the service.

Types of staff leasing

Staff leasing – the consultant/intermediary company concludes individual labour contracts with employees on behalf of its own name and redirects them to work within the client company for a relatively long period (from 3 months up to several years). At the ground of this practice is the client’s need to have a certain type of collaborators at hand given the circumstances of cyclic and varying volume of work.

Temporary staffing – engaging temporary staff for short-term projects or work for a period of 1 to 3 months. Temporary staffing is applicable in the field of administrative service, conferences, marketing research, promotions and other.

Outstaffing – in this case the intermediary does not engage in recruitment, but rather form in their staff list staff who are already working for the client. Essentially the staff is the same and continues to work for the same company as before. This type of assignment is suitable with companies who are in a good financial condition, but need to reduce the headcount for different reasons – stock market listings, initial public offering (IPO), specific corporate policy and other.

Outsourcing – one company provides another with part of its functions / services. The client company uses the provided services, not just the labour of the employees. This is suitable solution to be used for secondary functions such as maintenance, cleaning, support activities, which are not fundamental for the particular business and may vary in terms of workload.

Payroll administration – outsourcing of activities such as registering and administration of labor contracts, supplements and annexes, payroll, administration of remunerations, compensations and benefits, bonuses, sick leaves, vacations and other as a form of service provided by the consultant internally to the client company. It is suitable for smaller companies, where the number of administrated personnel cannot justify the capacity for a dedicated payroll position or when strict confidentiality of information is required.

Responsibilities for the consulting company

Administrative functions due to acting as a formal employer, such as:

• Selection, recruitment, management
• Labor contracts – preparing, registering, concluding, termination if necessary
• Remunerations – calculating, preparing, payment, generating relevant documentation record
• Regular reporting

Responsibilities for the client company

• Determining the conditions and characteristics of the work and functions
• Control, information and evaluation of performance
• Selection and/or approval of the offered employees

Financial aspects of the service

• Remunerations, health and social payments, taxes and other payments are handled by the consultant, based on a detailed report to the client
• The consultant ads a service price on top of the above mentioned elements, the price being calculated according to the number of employees, type of work, the period of  using the service
• The total amount for the service could be fixed, per person, per group of people, and as a percentage of the remuneration as well, could also include a guarantee for replacing employees in case of resignation or leaving, for new recruitment and other conditions

When and for whom is staff leasing appropriate?

• Foreign companies and NGOs, who are not (yet) registered in the country
• Organizations with little personnel, who do not consider it profitable to hire a person with such functions
• With temporary projects that require additional resources – promotions, marketing research, campaigns, seasonal hiring, temporary hiring, when the risk of laying off that staff is with the consultant company
• Headcount and payroll limitations
• Public companies who wish to reduce the income /cost to thenumber of personnel ratio
• Reducing administrative load for the HR department