Temporary Employee
What is a temporary employee?
A temporary employee is someone hired to fulfill a job role for a fixed, limited period of time. This type of employment is often used to cover regular employees’ short-term absences, meet seasonal employment demands, handle project-specific tasks, or manage increased workloads without committing to permanent employment.
Temporary employees can be hired directly by a company or through a staffing agency, which is a common practice for quickly filling gaps in the workforce without the lengthy process of traditional hiring.
How do you classify a temporary employee?
A temporary employee is typically classified based on the following characteristics:
- Duration of employment: Temporary employees are hired for a specific period of time, which can be determined by an end date, the completion of a project, or the return of a regular employee from leave.
- Employment status: Temporary employees do not have the same employment status as full-time employees. Their contracts usually specify that the role is temporary, detailing job responsibilities, duration and compensation.
- Benefits and entitlements: They might not receive the same benefits (like health insurance, retirement plans, etc.) as permanent employees, depending on the organization’s policies and local labor laws.
- Employment through agencies: Many temp workers are hired through staffing agencies, which often are their official employers, handling the payroll, taxes, and benefits while the employee works at the client company.
Temporary employee vs. independent contractor: Key differences
| Temporary employee | Independent contractor |
|---|---|
| Works under the employer’s supervision and control | Works independently, often controls how work is performed |
| Taxes are withheld by the employer | Pays own taxes, including self-employment tax |
| May receive benefits (health insurance, retirement plans) from the employer | Typically does not receive benefits from clients |
| Employer provides necessary tools, equipment, and workspace | Usually provides their own tools, equipment, and workspace |
Leased employee vs. temporary employee
Leased employees are part of a co-employment arrangement, typically facilitated by professional employer organizations (PEOs) that manage HR-related responsibilities, such as payroll, benefits, and tax obligations, for the client company. These employees are often integrated into the client’s workforce for an extended period, allowing them to become more entrenched in the company culture and operations.
On the other hand, temporary employees are hired to address short-term staffing needs, often through staffing agencies that handle the HR aspects of their employment. Temporary employees work for the client company for a limited time, offering flexibility without the long-term commitment or integration into the company culture that leased employees experience.
What are the benefits of hiring temporary employees?
Hiring temporary employees can offer several advantages to businesses:
- High flexibility: Temporary employees allow businesses to adjust more easily and quickly to workload fluctuations. This is particularly beneficial in sectors with seasonal peaks or specific project needs.
- Quick hiring process: Temporary staffing agencies often have pools of pre-screened candidates ready to work, which can significantly reduce the time to fill a position.
- Cost-effectiveness: Employing temporary workers can lead to significant cost savings. Businesses can avoid the high costs associated with full-time employees, such as health benefits, paid leave, and other employee-related expenses.
- Specialized skills: Temporary employees can be brought in for special projects requiring specific skills or expertise unavailable within the current workforce.
- Trial period: Hiring someone temporarily allows the employer to evaluate the worker’s performance and fit within the company culture before committing to hire them permanently.
How to hire a temporary employee: 7 steps
HR can hire a temporary employee either directly or through a staffing agency. Here is a step-by-step guide:
- Determine your needs: Clearly define job responsibilities, necessary skills, and employment duration to target suitable candidates and set clear expectations.
- Understand temporary employee rights and laws: Learn about the legal requirements for temporary employment, including equal pay, working hours, health and safety, and anti-discrimination laws, to ensure compliance and fair treatment.
- Source candidates: Use internal resources, job boards, social media, and staffing agencies to find qualified candidates. Staffing agencies can help manage legal and payroll issues efficiently.
- Conduct thorough interviews: Thoroughly screen candidates to confirm they meet job requirements. Conduct interviews to evaluate skills, motivation, and cultural fit and discuss the temporary nature of the role.
- Offer and negotiation: Present a clear offer detailing the terms of employment, ensuring it complies with temporary employee laws and regulations.
- Manage performance: Continuously manage and provide feedback on performance, addressing any issues promptly to maintain productivity and morale.
- End of assignment procedures: Evaluate the employee’s performance and determine if there’s an opportunity to extend their contract, offer them a permanent position, or conclude as planned. If the assignment is ending, ensure a smooth offboarding process.
FAQ
The transition from a temporary to a permanent employee depends on the organization’s policies, applicable labor laws, and both parties’ interest in a long-term engagement. This change typically requires a formal evaluation of the employee’s performance, an ongoing need for the role, and possibly a new employment contract.
The hours a temporary employee can work per week depend on local labor laws, company policies, and their employment contract. While full-time hours typically range from 35 to 40 hours weekly, temporary employees may work more or less, subject to regulations on maximum working hours and overtime.
The cost to hire a temporary employee varies widely, factoring in the staffing agency’s fees, the employee’s hourly wage, and any related taxes or benefits. Agency fees can significantly increase costs, often adding 25% to 100% to the employee’s pay rate. The total expense also depends on the industry, job role, and geographical location.
