The technology of personnel outsourcing in the format we are accustomed to began to be used around the 1960s in the USA and other developed countries. It reached its maximum popularity only by the 90s, when new laws regulating personnel management were adopted. Now American small and medium-sized companies were forced to spend a lot of resources on paperwork, and no one was happy with this.
Laws concerning personnel management began to be implemented in the early 80s, and this process ended in the 2000s. Businesses had to choose between spending time and labor resources to comply with all the new requirements and searching for alternative solutions. This is how outstaffing appeared.
In the Russian marketing with stockholder database Federation, outstaffing as a phenomenon appeared somewhat later, after 1998 and the severe economic crisis. At the same time, outstaffing of personnel has not become as popular as in the USA, where this format of labor relations is built on a clear legislative basis, and all implementation schemes have long been worked out. Today in the States, at least 80% of all small and medium-sized enterprises use the outstaffing service. And, since new firms are opening daily, we can predict an increase in the scale of application of this technology.
Outsourcing in personnel management is beneficial not only for enterprises, but also for the employees themselves: it gives them access to various benefits and a full social package (which small firms would not be able to provide them with).
Advantages, disadvantages and risks of outsourcing personnel
Advantages of outstaffing:
The company can easily obtain a qualified specialist with relevant experience and length of service.
Costs for wages and insurance premiums are reduced.
The costs of a special assessment of working conditions are reduced: since the work unit is not on staff, there is no need to assess its workplace.
The company does not have to deal with issues related to benefits, social packages and other guarantees for staff.
The workload on the HR department is reduced.
There is no need to include additional work units in the staffing schedule.
At the same time, workers constantly work at their workplaces and perform their functions.
The company is moving some of its employees off-staff, while retaining the right to remain a small business entity and operate under the simplified tax system.
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Alexander Kuleshov
Alexander Kuleshov
General Director of Sales Generator LLC
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