hello, Can anybody throw light upon the temporary workforce . what is the basis of contracting them ? what is the relevance in todays market? why would people go for it ... what are the attractive offers it give.. hope to get a reply take care
From India, Mumbai
1From India, Mumbai
Hi Neha, As per my knowledge, The market for contract staffing is growing tremendously. In a number of IT companies, a fixed percentage of employees have to be on contract. They would largely be people in the admin dept and level 1-3 cadre employees. The company benefits in terms of cost to these employees, Good Will [Control on Attrition], Check on Performance. If the employee is not good performer the company can dismiss the services without bothering about the notice period. With respect to the employees, he can get a break in top companies, and some times he gets good salary. But again if he gets a permanent offer in any other good company, he jumps jobs. Thus posing a threat to his assignment. Following is one of my opinions posted some time back, for a similar question. Contract Staffing is very much valid in India and is a hot business today. The law says that a person should not be on contract for more than 90 days. So the contract agreement is made for 90 days and renewed every 90 days. Such people will not be eligible of PF or any statutory obligations. They would be paid a consultancy fees and not salary. The fees would attract a TDS [i think it is 5.2%]. They would not be eligible for any benefits from the company. The company would benefit in terms of Cost Cutting, Lay offs, Head Count for a particular dept. Let me know if this helped you. Regards, Soumya Shankar
From India, Bangalore
From India, Bangalore
Hi Neha, Outsourcing or contracting of temporary staff is the in thing in the service industry. The advantage of outsourcing is that it keeps your organisation lean and the obvious financial advantage coz of being lean. the trend is to keep sales force, data entry operators and similar jobs outsourced. Here very often the contract is drawn up for the job eg. scanning jobs in telecom may be outsourced and the contract is on the total number of pages scanned, the no of people employed is upto the service provider (contractor). The points to be taken care are that the service provider should have a license under the CL(R&A) Act, 1970 and there are some legal provisions to be taken care under the same act. As a principal employer you have to ensure that the contract staff is being given the benefits under EPF Act and ESI Act/ Workmen's Compensation Act (as applicable). Hope I have managed to throw some light into the topic. Warm regards, Gautam "When the going gets tough, the tough gets going"
From India, Pune
From India, Pune
Dear Neha, Contract Staffing in India taken cue from American Industry where contracting is a regular norm. There are many thoughts about the contracting but most prevalent one is to save cost in comparision to permanent employee where the employer do not need to to pay for PF and doing a performance appraisal etc. But there is a flip side also to it. In comparision to permanent employee motivation level is always less as employee is there for a certain period of time only. Warm regards Sujeet Kumar
From India, Pune
From India, Pune
Hi Neha, Temporary Staffing market is here to stay. Companies go for it because : 1. Large companies have freeze on recruitment due to some corporate decision taken somewhere in the head office 2. It eliminates lot of statutory requirements like payroll, PF , ESI etc so they can focus on their core businesses 3. If the temp staff goes on leave it is the temporary staffing agency's responsibility to provide a replacement, the work does not suffer 4. Some companies also take staff on contract which they later hire ... this ensures 3 months of observation rather than couple of hours of interview 5. Some organisations have seasonal or short-term demands. They can easily scale up / down operations as per the need of the business e.g agriculture Candidates go in for it 1. Makes them more employable 2. Gives them opportunity to work with multinationals where they may not get an opportunity to otherwise work 3. Some people who are not employable - get an opportunity work e.g. in India if housewives decide to go out to work after children have grown, they may only get a temp job 4. it may lead to permanent employment In India Temporary staffing is only starting to take off whereas in most developed countries as well as in China it is a mature market. Inspite of all the cons of Temp staffing, this industry is here to stay and grow. I've covered only very fundamental points but there is a very strong case for temporary staffing across industry ... be it agriculture, manufacturing, travel, IT/ ITES .... in fact most of them. regards Madhujit
From India, Hyderabad
From India, Hyderabad
hi saumya, thanks a lot for the information ,,,, it was a great help ,,,, !!! Looking forward to more insights as i would like to see its relevance in particular industry ,, c ya take care
From India, Mumbai
From India, Mumbai
hi Gautam that was a very useful information .... thats what i wanted to know .... the relevance in a particular industry .. thanks a lot.. !! take care
From India, Mumbai
From India, Mumbai
hi Madhujit, very nice insight to the topic ,,,,, It will help me out for further study for its relevance in a particular industry or a sector ... thanks a lot take care
From India, Mumbai
From India, Mumbai
For employing staff through contract, the principal employer has to take a licence (this is as per Contract Labour (Regulation & Abolition) Act and should issue a form (Form V) to the contractor who will supply the manpower. Contractor has to submit his application for licence along with Form V issued by the principal employer before deploying the manpower. Contractor has to pay minimum wages as per Minimum Wages Act while complying to PF/ESI/Prof Tax Acts applicable to Contract Labour based on the type employment (unskilled/semi skilled/skilled/highly skilled). In case the contractor is not complying with the above statutory acts, then the principal employer is bound by the same. However, not every position is permitted under contract labour act. For more details check in Contract labour (Regulation & abolition) Act. Regards, AR Sai.
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