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Outsourced Employment

Employment Outsourcing


1.       Employment outsourcing is a practice that many companies around the world are adopting to achieve greater organizational flexibility, improved efficiency, reduced overheads and a hassle free Human-Resource management. Employment Outsourcing effectively relieves the management from employees’ day to day HR operations, saving their valuable time and enabling them to focus on more strategic and value adding initiatives.


2.       The outsourced staffs’ employment records/files, salary & benefits management, promotions/increments, regulatory & statutory requirements and all disciplinary & performance management matters, legal/labor court issues, are all become responsibilities of the outsource service providers, relieving parent company of all the hassles & more importantly, relieving them of all the legal & financial exposures.


3.       In case of employment outsourcing the company knows & builds the HR expenses, as fixed expenses and uncertainty in cost, is removed out of equation. The outsourced part of HR expense then becomes a “fixed expense” for the company.


4.       The outsourced employees add value to the company operations/productivity, but their other indirect inputs (management costs/statutory handling costs & exposure/unforeseen costs) are all eliminated.


5.       Generally, these outsourced employees get better HR services, then, regular employees of the company, in terms, of timely & efficient salary transfers, pay slip up dates, timely employee cards issuance & replacements, appointment contracts issuance, attendance record maintenance.


6.     They get benefited because of provision of decent web based HRIS, with their vendor, which the parent companies may or may not have


7.       The vendor may also provide specialized dedicated performance certificates, which not all companies do for their regular employees. The vendor may also provide outsourced employees satisfaction surveys, which may help companies in aligning their services towards regular employees


8.       The vendor has large pool of employees on their payroll, working for various organization, this helps them in negotiating better medical insurance deals , which they pass on to their outsource employees, resulting in better outpatient facilities for outsourced employees, than, regular employees, at times. 


9.       Generally, the long term HR costs (gratuity/provident fund) are minimized, if not eliminated altogether.

Posted by: Esquare Admin

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