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The Pros and Cons of Using Labour Hire in Modern Business

Nowadays, more and more industries and businesses use labour hire companies rather than labour-recruiting companies to find potential workers.

In this article, we look at what labour hire is and the pros and cons for businesses and workers to be employed and placed by labour hiring companies.

What are labour hire workers?

Labour hire workers are workers who are employed by a labour hire company which then hires the workers out to different businesses. The labour hire company is responsible for paying the workers and handling the administration around the whole employment process.

The labour hire company ensures that its workforce is “constructed” in such a way that it can supply whatever service a business is looking for. It does effective workforce planning and is constructed to have clear communication with its workers and the host employers.

The pros of using labour hire

The most important pros of labour hire include the following seven:

1. Your business has the option to utilise skilled people for short periods

Most labour hire services can provide skilled workers for short to medium periods. Your business doesn’t have to employ someone and then terminate the employment after a short time. This is good for your business and the worker.

2. Most labour hire companies offer the option of a trial period before commitment

If the worker doesn’t fit your business the labour hire company will replace the worker with a more suitable one.

3. Labour hire offers the option of flexible labour

Labour-hire services give your business the flexibility to use supplementary labour in peak times and scale down again in off-peak times.

4. Businesses can fill vacancies with speed and efficiency

Reliable and experienced labour hire companies usually have potential workers ready for fast and efficient placement at your business. The process is much faster than the “normal” HR recruiting procedures.

5. Workers with specialized skills are available on short notice.

It is ideal to use a labour hire company when your business needs specialized workers only for a specific project.

6. It is cost-effective to use labour hire

Your business pays the labour hire company an agreed fee for their services and you don’t have to negotiate salary and benefits with potential workers. You also don’t have to contribute to a pension or medical funds for the worker as the labour hire company is doing it. The HR component of your business involved with recruitment can also be minimised and you don’t have to pay for advertisements if you have a vacancy.

7. The labour-hire company takes away the administrative red tape

The labour-hire company takes away the administrative red tape regarding employment. If needed, the labour hire company will handle aspects such as compliance, and it will also manage the mandatory documentation and registrations required by the Australian authorities.

Are there any cons when using labour hire?

Unfortunately, there are also cons when you use labour hire. The most important con is the possible lack of loyalty to your business. The worker might feel it is “just a job” and because there is a possible lack of company-specific knowledge doesn’t really feel loyal to your business.

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