The Pros and Cons of Hiring Contracted and Temp Employees

When someone is searching for a job, most of the time, their goal is to obtain a permanent position, part-time or full time. They are looking for security, a place to grow in their skills, and they don’t want to have to worry about being unemployed again. However, there are times when a need for extra help arises and that need may not be long term. Therefore, a company decides to post an opening for a contracted or temporary position. People in search of this type of position may be a newcomer to their career field—college students and recent graduates, people who have had trouble finding work—people who have been fired and unemployed for months, even years, or people with a more undefined set of skills. There are specific characteristics and situations you will be looking for in a temporary or contract employee and there are positive and negative effects for the worker and the company from hiring a temporary employee.

Some reasons for hiring a temporary employee include employee absences, maternity leave, a sudden vacancy, special projects, or a peak in the season. When companies bring on temps, they can adjust more quickly to workload fluctuations. Their temporary status provides flexibility for them and for you: they may have other commitments to work around and you may not need them for eight hours a day, five days a week.

You can also evaluate the employee without making a commitment. You can determine if they are a good fit for your company and study their work performance—if you like what you see and the possibility is there, you can decide to offer them a permanent position. On the other hand, you know exactly how long they will be working for you as a temp and can release them without a lengthy explanation if you don’t see them fitting into your company long term. Temporary employees also save cost because you can offer them a lower pay rate and are not obligated to provide a benefit program and the same goes for independent contractors. With contractors, when there’s not work for them, you don’t need to pay them. When you hire through an agency, they can quickly help you find a qualified person and you can build a relationship with that agency.

With any temporary employee, there will be some need for training because there are skills and procedures specific to your company that they need to learn. Oftentimes, these employees have a lower morale because they don’t feel like an equal part of the team—although they should be treated with the same respect as any of your full-time employees. There are safety issues they must quickly be trained on and if they don’t learn them in time, there is a greater chance for injury. You don’t want to take any legal risks, either—make sure the timeframe and other terms of their employment are set in stone. For contractors, you do need to pay them according the market rate for the type of work they do and classify them correctly for taxes. They have control over whether or not they accept a project from you, making them less reliable. Finally,contractors are allowed to also work for your competitors—if they do great work for you, they’ll do great work for them.

All things considered, you may decide that hiring a temporary employee is just the thing to fit your current company needs. Just remember that most of the time, the benefits for you are the drawbacks for the employee, so make sure they are willing to work with them.