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Can Temporary Employees Cut Your Overtime Costs?

July 14th, 2017

Overtime hours committed to the company by hardworking employees can be a godsend for a growing company; these extra hours put in outside of the standard business day and exceeding 35 hours per week can keep a company afloat during a challenging crisis or a rush of deadline driven orders. But of course this dedication comes at a cost, and while overtime hours are invaluable, they also cut into the margins they produce. So if you feel like these margins are undermining your long term success, consider easing the pressure on your current teams and reducing the strain on your bottom line by employing temporary teams for short term projects. Here are a few factors to consider.

Highly Skilled vs Medium-Skilled Labor

If you have highly trained or certified staff members putting in overtime hours to conduct tasks that lie outside their skill areas, reconsider. A trained machinist who stays after hours to help box and ship a rush order, for example, may be making 1.5 times his or her salary to complete a task that could be managed by a junior or temporary staffer. When it comes to overtime costs, task allocation matters, and small missteps in this allocation could come at a high cost.

Temporary employees bring value of their own

Some question the value of bringing on new or temporary team members who may take the hours that rightfully belong to seasoned and committed full-time employees. But don’t discard or dismiss the value of temporary labor. Temporary employees often work just as hard and possess as much skill, training and commitment as full-time staff, and more important, temporary employment often serves as a pipeline to full time hiring agreements. Connect with your temporary employees and evaluate their performance closely. Ask them about their plans for the future, and if they’re seeking full time work over the long term, develop a pathway and offer guidance to help them move in this direction.

Full time hiring can bring a high price tag

Hiring full time staff to handle temporary or seasonal burdens can be an expensive move. The hiring process brings background checks, paper work, tax reporting, and sometimes legal contracts that can be costly and binding. But temporary staffing means rapid, inexpensive onboarding, and an easy drama-free separation after the short term period ends. In the interim, the staffing organization handles the insurance and paperwork so you don’t have to. During the contractual period, your team member works for the staffing company, not for you.

For more on how to choose temporary help to move your growing business through peak periods of high demand, contact the Fairfeld County staffing and management experts at Merritt.

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