Temporary employment, outsourcing, employee leasing

October 16, 2017

In our times, it is becoming more and more popular to use alternative forms of employment. This results, in particular, from employers’ variable demand for work. Therefore, it is worth knowing the respective forms of employment in order to use them consciously and according to the law.

Temporary Employment

Temporary employment is regulated by the Act on Temporary Workers (Journal of Laws of 2016, item 360) and the Labor Code. It is a form of employment with three parties: temporary worker, temporary work agency and user-employer. A temporary worker is hired through a temporary work agency on the basis of a temporary work agreement.

As a result of the changes introduced by the amendment to the act on temporary workers on 1 June 2017, a temporary worker may perform temporary work for one user-employer for the period of no more than 18 months in the period of 36 consecutive months.

Frequent changes of workplaces results in additional skills and experience. On the other hand, concluding a temporary work agreement for several days or several weeks does not provide a feeling of professional stability. Some are convinced that the positions offered by a temporary work agency are not really attractive and that the permanent workers of the given user-employer do not want to perform that type of work.

However, the benefits of temporary employment definitely outweigh the disadvantages. Flexible working hours allow temporary workers, especially young people, students, to gain experience. Agencies may also assist in returning to work after a long period of absence caused by an illness or maternity. Large corporations use the services of temporary work agencies by offering a broad range of workplaces and, possibly, by offering permanent employment. Temporary work agencies allow to quickly adapt to the changes in the labor market, to maintain employment flexibility, and to adapt the number of staff to employer’s needs.

Staff outsourcing

Staff outsourcing has not been legally regulated yet. There exists the important judgement of the Supreme Court of 27 January 2016 (file reference No. I PK 21/15) which defines staff outsourcing as an undertaking which consists in separating certain functions performed by the original enterprise and outsourcing them to other business entities. Therefore, staff outsourcing consists in ordering a third party entity to perform certain tasks through its own personnel. In that structure, the entity using the outsourcing does not have any legal relationship with the person factually performing the work for it. The fundamental characteristic that differentiates staff outsourcing from employment of own workers or from performance of work by temporary workers, is lack of direct and permanent subordination (legal or factual) of the worker to the entity, in which the services or works are performed. Sometimes staff outsourcing consists in transferring a part of an employment establishment to outsourcing (art. 23.1 of the Labor Code.

The benefits of staff outsourcing are associated, in particular, with possession by the outsourcer of qualified staff specialized in HR, payroll and recruitment processes. The vast databases of candidates allow to reduce the costs and timeliness of the recruitment processes, which attracts large corporations. Cost reduction also results from a reduction in FTEs, a reduction in salaries, social, pension, health benefits as well as in the costs of maintaining workplaces. You can benefit a lot from outsourcing, but you can also lose a lot, so a proper outsourcing partner should be selected in order to minimize that risk.

Staff leasing

Staff leasing is addressed in art. 174.1 §1 of the Labor Code and consists in one company lending employees to another. The employer may grant an unpaid leave upon a written request of the employee, for the period specified in the arrangement. The arrangement should specify the type of work that the employer is to perform in favor of another employer as well as the remuneration. The employee will establish an employment relationship with the new employer, so another employment agreement will be concluded.

Staff leasing is particularly useful when your demand for labor is decreased, by reducing the need to dismiss permanent employees. It is most often used in the cases of performing one-time activities or tasks, which permanent employees are not licensed or prepared to do. Staff leasing is also used as a form of substitution in longer period of absence from work. The benefits exist for the original company, because it does not bear the costs of employment, as well as for the target company which gets an experienced employee.

The disadvantages of staff leasing include short periods of employment which may affect the quality of the tasks performed, which is often associated with lack of the feeling of attachment towards the new employer.

Tags employee leasing Poland, outsourcing Poland, temporary employment Poland