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Differences between temporary and contract employees

Why hire temporary employees?

Limitations of hiring temporary employees

Employer’s responsibilities toward temporary employees

What is a temporary employee

A temporary employee is a worker hired for a short time period, often on a project or assignment basis. 

Temporary workers are often hired through temporary staffing agencies. By working in temporary employment, they do not have the same job security or employee benefits as permanent employees, such as health insurance, medical leave, or maternity leave. 

Still, temporary employees may have the ability to work on a flexible schedule and take on a variety of different roles.

Differences between temporary and contract employees

Temporary and contract employees are similar in that they are both hired to work for a specific period of time (often short-term) rather than being permanently employed by a company. However, there are some key differences between the two types of workers.

Temporary employees are typically hired through a temporary staffing agency, which acts as an intermediary between the worker and the company. The temp agency is responsible for finding temporary positions for workers and handling their payroll and other administrative tasks. 

Temporary employees may be assigned to work multiple temporary jobs for several companies or projects over the course of their employment.

Contract workers are hired directly by a company to work on a specific project or assignment. The terms of the contract, including the length of the assignment and the specific job duties, are agreed upon by the independent contractor and the company in advance. 

Contract employees may have more stability than temporary employees, as they are typically assigned to work on a specific project for a set period of time. However, they do not have permanent work, and they may not have the same job security or benefits as full-time employees (or even a part-time employee).

Why hire temporary employees?

Hiring temp workers can be a cost-effective and flexible way for companies to meet their staffing needs. Consider the following benefits of hiring temps.

  • Hire workers flexibly to adjust the workforce as needed, helping to meet changing business demands and fluctuations
  • Introduce a new skill set into a company, providing a fresh perspective on projects and tasks
  • Save time and money on training and onboarding, as the staffing agency is typically responsible for providing any necessary training
  • Available to start working quickly, which can be useful for companies that need to fill gaps in their workforce due to unexpected absences or increased workload
  • Avoid the costs and complications of hiring permanent employees, such as providing benefits and handling termination procedures
  • Provide companies with the opportunity to test potential new hires temporarily before inviting them to be permanent workers (serving in a full-time position)

Limitations of hiring temporary employees

Even with these benefits, there are a few considerations, such as the following.

  • Temporary staff may not be as invested in the success of the company as permanent employees, as they do not have the same long-term commitment to the organization
  • Companies may have limited control over the quality and reliability of temporary employees
  • Temporary employees may not have the same depth of knowledge and experience as permanent employees
  • Hiring temporary employees can be more expensive in the long run than hiring permanent employees, as the costs of using a staffing agency are typically passed on to the company
  • Temporary employees may not be eligible for the same training and development opportunities as permanent employees, which can limit their ability to grow and advance within the organization

Employer’s responsibilities toward temporary employees

Employers and the human resources department have several responsibilities toward temporary employees, including providing a safe and healthy work environment and company culture, complying with labor laws and regulations, and treating temporary employees fairly and respectfully. 

Temporary employees are entitled to the same rights and protections as regular employees under the law, including the right to be paid fair workers’ compensation fees (at least the minimum wage) and to receive overtime pay for any hours worked over 40 in a week (in the US).

When choosing to hire temp employees, employers must also provide the necessary training and equipment to perform their job duties safely and effectively. Additionally, employers should communicate clearly with temporary employees about their temp job duties, expectations, and changes to their work schedules or assignments.

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