27 Apr Temp-to-Perm: What are the true benefits
Hiring a full-time employee is pricey and time consuming. It can cost up to $5,000 just to bring someone on board (SHRM, 2016) and you may be left wondering, “Is it worth the risk?” The hiring process can be compared to having the first pick in a draft, but you’re left not knowing if the individual could be a future leader or a total bust. With that, considering a temp-to-perm model for your organization could have its perks, especially in today’s low unemployment market.
Companies are now challenged with finding quality talent where little to no talent is even available, forcing them to think outside of the box and reinvent how they recruit. Temporary workers are commonly used to supplement staffing needs to cover for a leaving employee or to meet an increased workload. Slowly, some companies are beginning to employ a temp-to-perm model which engages temporary workers who may eventually fill a permanent role. If your company hasn’t considered this model yet, you may want to think of its benefits.
As an employer, why should I use contractors or temporary employees?
Vendors Work for You
Possibly the greatest benefit to using a temp-to-perm model is engaging vendors to compete for your business and extend the reach of your recruitment team. Working with vendors increases your company’s staffing presence in the market and it costs nothing unless that individual is offered the assignment. Vendors also have a better scope into the job market with large networks and talent pools that many organizations may not have access to. This, in turn, gives them better access to additional candidates that otherwise may not have been found. If a candidate is offered an assignment with your company, the onboarding responsibilities can also be transferred to the vendor. And while the onboarding process can be very tedious and costly, the results that working with vendors provides can save your company both time and money.
Longer Evaluation Period
As an employer, another advantage to using a temp-to-perm model is the longer amount of time available to evaluate the talent before accruing the costs of bringing them on as a permanent employee. Many organizations decide on a candidate after one to three interviews. So, the truth is after a few short hours, a company has decided to invest in that individual. This can be risky as someone may look good on paper or may interview well on the phone or in person, but they may not be able to perform well in the role. If the company brings on a candidate that is in a temp-model, that individual is on a job interview for the duration of the assignment. During that time, the employer can evaluate the worker’s performance based on their quality of work, cultural fit and overall ability to perform the job. From there, the employer can then make a more well-educated decision whether or not to hire them later on.
Reduced Legal Risk
Temporary workers are brought in on an assignment basis, therefore, allowing companies to end an assignment as needed should their performance or job fit falter. This reduces the risk a company has from a legal perspective and also keeps the company out of a negative limelight.
Allows the Contractor to Assess Your Organization
We are accustomed to the saying, “The grass isn’t always greener on the other side.” Temporary employees are looking for meaningful work and they consider the company’s brand and image when deciding to change jobs. And by working in a temp-to-perm opportunity, they can evaluate the job and the company. Ultimately, this allows for a better buy-in from the worker, resulting in better engagement and better likelihood they will stay with you longer.
An argument is often made that it costs more to bring somebody into an organization through the temp-to-perm model. This on paper looks to be correct because most organizations are looking at the bottom line for labor. The truth is, bringing a worker in on a temp-to-perm basis can not only save the company money, it also saves it time and reduces risks.
1. Companies can engage the worker without the overhead of traditional benefits, which can cost an organization up to a third of that employee’s salary.
2. Bringing a worker in on a temp-to-perm basis also reduces additional costs of having to pay unemployment benefits.
3. Lastly, the temp-to-perm model helps reduce the cost of internal recruiter’s time. On average, it takes 42 days to fill a position through internal recruitment (SHRM, 2016). When considering the amount of days it takes to fill a position, combined with the average salary of $49,000 an internal recruiter makes a year (Glassdoor, 2018), it could cost a company over $5,000 to fill a position.
How to be successful in a temp-to-perm model
The most important aspect of having a successful temp-to-perm model is to make sure that you treat the temporary workers in a way that engages them so they are attracted to the organization and job. All too often, companies treat temporary workers as expendable which can result in organizations missing a great opportunity to find and interact with potential talent. Companies should treat these workers as extensions of their team while keeping their co-employment in mind.
As a company or manager, it is also important to have the team’s buy-in to ensure the temporary employee fits in well with the group. This can be done in multiple ways. First, consider including senior members of the team in the interview process. Second, assign a mentor that helps guide the worker throughout their assignment. These steps allow people to see different sides of the individual, they help connect with them on a different level and they provide ongoing support for success.
Lastly, ask the vendor to do check-ins on the worker to gauge how they are doing. Workers may not always come forward to share their concerns, but they may be more open to speaking with their vendor. This is a great way to learn about internal challenges and successes; the worker’s likes or dislikes about the organization; and to measure if it’s a good company-fit for the worker, as well.
A temp-to-perm model takes commitment and planning in order for it to be successful. If a model is managed well, you will see the success. Finding good talent is hard, especially now with the unemployment rate being at an all-time low. But giving these temp-to-perm workers the chance to assess your company before they commit to full time opportunities within your organization might be the key when searching for that perfect candidate.