All business leaders would agree that one of the most difficult, challenging, and costly processes within an organization is staff management. HR and recruiting the best specialists, hiring, and managing personnel requires time and money. It also requires companies to have a well-established human resources department that handles all aspects of employee management.
There are situations in every company’s activity where the business needs more employees than usual, whether due to seasonal work or an increase in production. In such cases, two of the most popular human resource management practices are staff leasing and staff outsourcing.
In today’s article, we aim to provide some insight into staff leasing, also known as staff lending, and clarify this concept for our readers.
Personnel leasing is a widespread concept in Europe, including Romania. In 2020, it began to be legally regulated in Moldova as well. This concept involves the temporary provision of a labor force to a partner company upon request, while the workers remain employees of the recruitment agency.
There are three participants in the staff leasing process: the recruitment agency, the client company (beneficiary), and the temporary employee. These three do not sign a single, common contract. Instead, the recruitment agency and the client sign a staff leasing contract, and the employee signs an individual employment agreement with the recruitment agency.
In other words, those who work under this system are officially employed by the recruitment agency, but they actually provide services for the client company that requires staff for a specific period. The recruitment agency handles all salary-related tax payments. For the services provided, the client company is invoiced by the recruitment agency according to the previously established contract, which includes both the amount intended for the employee’s salary and taxes, as well as the commission for the leasing agency. As a result, the recruitment agency does not deduct any commission directly from the employee’s salary.
Staff leasing is highly convenient for the client company, which can acquire qualified staff quickly and with minimal risks and expenses. It is also advantageous for the recruitment agency, as it enables them to engage in a specialized economic activity. Lastly, the temporary employee is not affected socially or financially by the entire process.
Our association’s staff leasing service targets the foreign market. We work with small and medium-sized companies in Europe and the United Kingdom to temporarily employ our citizens abroad.
Staff leasing is the most effective solution for companies that need seasonal employees. This service ensures the necessary flow of employees and contributes to the efficient organization of production. For the employee, this service does not impact their employment agreement or legal working status. In fact, it provides additional security.
