Employee Leasing Services: Is It Here to Stay?

The business environment has become so dynamic that business owners find themselves constantly looking for new ways to save on costs, improve productivity, and ultimately grow their business. Among the things that have become a common “way out” of business owners wanting to cut costs is to cut down the number of in-house employees. In lieu of the employees they let go, businesses have begun turning to employee leasing services.

How Employee Leasing Services Work

When you lease employees, you are basically hiring a third-party company to handle the administrative or non-core aspects of your business. The employees who are responsible for dealing with the tasks you assigned to the leasing company are officially in the employ of the company, but it will be you who pays for their wages, taxes, and related expenses. This is a form of outsourcing, which has become a popular business strategy these days.

Why Employee Leasing Services Have Become Popular

employee leasing services Like many other business strategies, the main reason for the growing popularity of this service is that it offers several important benefits to business owners. As mentioned earlier, this is a favorite strategy among those who want to cut costs. Sure, you still have to provide employee wages as well as pay taxes and insurance. The difference is that, for one thing, leasing companies typically get discounted rates when they purchase insurance because they do so in bulk. This alone already saves you a considerable amount of money.

Another advantage to leasing is that the employees are officially employed by the third-party company. In case of work-related injuries, therefore, it’ll be the third-party company that’s responsible for claims. Business owners also appreciate the fact that this strategy allows them to expand or reduce their workforce as needed. Furthermore, it gives them the opportunity to focus on perfecting their products and/or services, while the leased staff handles administrative stuff.

When most business owners start considering the wisdom of this service, they tend to wonder about two things: First, if the strategy is well-suited to the kind of business they’re in. Second, if this service is just some sort of a fad or if it’s here to stay, something they can benefit from for the long term. To address the first concern, answer these questions:

  •  Are there administrative/non-core tasks that are distracting you from the core aspects of your business?
  •  Are you looking for ways to maximize your profits and reduce operational costs?

If you answered YES to either question, then it may indeed be a good idea to lease employees. As for the second concern, it’s easy enough to see that this service isn’t merely a fad that’ll soon lose its appeal. If it was, its popularity should have waned long ago. As it stands, more and more businesses are still taking full advantage of its benefits. So yes, it may indeed be safe to say that this business strategy is here to stay.


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