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March 26, 2018

Outstaffing vs Leasing vs Outsourcing

Outstaffing vs Leasing vs Outsourcing

In my work, I very often apply the principle that Albert Einstein said more than a hundred years ago: "Everything should be simplified as long as it is possible, but not the pain of it." Scaling business is a difficult task and for its implementation effective, but simple enough tools and technologies are required. Among them are the "overseas" processes of outstaffing, outsourcing and leasing, which are relatively new for Ukraine (fixed only at the legislative level only in 2010), which not only successfully and quickly "close" gaps in the shortage of personnel for the period of seasonal works and promotions, but and help to redirect the attention and strength of the best specialists in the company to the solution of the main profile issues, "unloading" them from the current secondary tasks.


In fact, these three concepts "talk" about the same different words: they help to optimize internal business processes by attracting external resources. If outstaffing is the withdrawal of one's own staff for the staff and the transfer to the second person, usually a recruiting company that takes care of the calculation, payment of wages and all the functions of a normal employer, including labor protection, then outsourcing is the same conclusion, but no longer staff , and the whole production process or a part thereof (for example, HR function or part of the marketing marketing process). When outsourcing a business process, the provider of this service is obliged to perform KPI's for the function that the customer transferred to it.

Personnel leasing is literally his "leasing" (for top vacancies - this is Interim Executive, for middle-level positions and lower - Temporary Staffing). The term of leasing is from one day of the year, at the same time the executing company "hires" the necessary personnel to its own staff and "leases" it to the customer for rent.


Outstaffing as a tool for optimizing business processes in each case is effective in its own way. For top management, its purpose is to preserve confidential information about salaries and bonuses, plus significant savings on a single social contribution. For office staff outstaffing helps to optimize staffing, "prepares" staff for the next stage - outsourcing the entire business function. For mass positions ("field" personnel, personnel at work, in retail outlets, warehouses) - allows for the use of temporary employees, and "pleases" the transfer of risks associated with occupational safety, to a second person.
In the outstaffing agreement with the provider there is one feature - the provider claims the prices for its services as a percentage to the payroll and monthly staff costs or as a fixed remuneration per person per month.

Tips for using staff outstaffing:
№1. Make sure that the service provider has sufficient financial resources to pay a wage fund at least for 1 month. Let your accountant see a fresh balance report of your provider;

№2. Demand from the provider full decryption of the monthly invoice (wages, taxes, service cost, pre-payments);
No. 3. Make sure that your employees have exclusive labor contracts, not civil-law contracts.
№4. Do not create an "army of private entrepreneurs" from your staff. - These expenses will be clearly "deducted" from your gross costs and taxed on profits;
№5. Do not outsource your key people: they will certainly be more useful in the "rear" than on the periphery.

When leasing the personnel, the provider is responsible not only for calculating, paying salaries and personnel work, but also for recruiting staff, so the "use" of personnel for less money and / or the exact comparison of man-hours purchased with the production needs and reducing downtime substantially saves customer money.
Important! Hourly tariffs provided by providers, as a rule, are of a closed nature, that is, without disclosing the cost structure.

As for Interim Executive, or temporary manager, it is often "booked" in companies for the selection of managers. The prices of Ukrainian agencies for this service are on average from 500 to 5000 UAH / hour. The tariff for leasing auxiliary personnel, for example, a secretary, or assistant accountant is much less - from 50 to 100 UAH / hour. Prices for leasing "field", production or retail staff is even lower - from 20 to 50 UAH / hour.

Tips when using leasing staff:
№1. Use leasing in areas with high turnover;
№2. In areas with high turnover, begin work with outstaffing and then go on leasing staff;
No. 3. To conclude contracts on personnel leasing is better with those providers who perfectly know the market of these professions. They will be able to find the best-priced resources, which in the end will help them reduce hourly rates and as a result will give you savings;
№4. To save with leasing, the key factor is the proper planning of your business needs in the one hundred

CEO Brain Source International

Andrey Krivokorytov

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