Differences Between A Labour Hire Firm and A Recruitment Business

At first glance, a labour hire Perth company and labor hire recruitment company might look quite similar in what they do, but analyze their roles more closely, and also important gaps will emerge. They may be in the exact same line of business -- that of supplying labour to companies -- but the way they go about it's fundamentally different.

While both companies are experienced recruiters who aim to simplify the often long, odious and expensive process of hiring new employees, understanding how each functions is imperative to ensuring that you chose the best one for your staffing needs.
To help you differentiate between a labour hire and recruitment firm, we shall be studying each comprehensively to understand how each works, how each can benefit your organization, and the best to suit your specific labour needs.

A recruiting company is a matchmaker connecting individuals searching for gainful employment with businesses searching for workers. They essentially take over all the manual work of HR ensuring that candidates supplied have the necessary skills, qualifications and experience needed to fill the job and meet the business' needs.

Once approved by the client company, the candidate provided by the recruitment firm becomes a full employee of the client company that's responsible for paying wages, entitlements and managing them henceforth.

How recruitment companies work

Although every entity has their own way of doing things, recruiting companies generally follow the exact same pattern.

  • The customer (after identifying a vacancy) sends out a comprehensive job description for the vacant position to the recruitment firm.
  • The bureau will then sift through their CV database and identify people that best meet the customer's criteria and draw up a shortlist. If the skill sets are not available from their database, they'll advertise and evaluate candidates for that specific position.
  • The customer is then handed the best matching CVs for a last selection and the agency will arrange and organize the final interviews.

The selected candidate is inducted into the customer's company as a "direct" employee on the company's payroll. A finder's fee is paid to the recruitment agency, and their relationship with the candidate ends there.

Benefits of using a recruiting company

Businesses gain several benefits from using a recruiting agency for their labor requirements.

The process of selecting a new employee isn't only long but expensive too. When you employ the services of a recruitment firm, you are basically farming out the recruitment function and applying the recruitment firm's database to find the best employee to fill a vacancy. Labour recruitment companies maintain large databases of employees with various kinds of skills. This allows them to recruit for almost any position within a brief time. A recruitment firm takes all of the hassle out of recruitment, all you need to do is provide the job description of the employee you need through email or phone call, and they'll do the rest of the job.

  • Market knowledge. Recruitment companies are vastly knowledgeable in the labor market for the businesses they recruit for. This enables them to receive the best employees for you for those niche skillsets.
  • Robust recruitment processes. Recruitment companies have specialised recruitment processes that ensure they only provide the best labor for your business.
  • Labour hire companies -- about them

    Labour hire firms are similar to recruitment companies in that they join ready and willing workers with firms seeking labour. Unlike recruitment agencies that completely deliver the employee after the recruitment process, labour hire firms provide employees on a 'labour hire' arrangement.

    What this means is that the workers provided to the client company either for short term or long term positions aren't employees of the customer. recruitment agency The workers are hired out to them. They are those that maintain the worker's payroll.

    When stationed at the client's organisation, the employee will work just like regular workers, wear the company uniform if needed, and will use the company's tools and resources. The direct employer-employee relationship will, however, remain under the labour hire company's domain name.

    The benefits of labour hire to companies

    Businesses stand to gain numerous benefits from labour hire, these include:

    1. Reduced prices. Like recruitment businesses, labour hire businesses take care of the whole recruitment process including advertising the positions, assessing CVs, screening applicants, providing preliminary training and onboarding. Along with this, labour hire companies offer payroll maintenance for their workers freeing you from doing it. Unlike recruiting companies, candidates provided by labour hire firms are not suggestions to be considered but workers who have been vetted, trained, and deemed capable of taking on the role. This makes them ideal for emergency cover because they may come in and begin working immediately reducing the effect of employee absences. Whether an employee misses work because of illness, maternity leave or annual leave, labour hire makes sure that you get a worker to take over their responsibilities in a short while.
    2. Experience and experience. A labour hire arrangement enables you to bring in the specialised skills and experience you require for some project on hire basis without needing to take on the employee full time. This means that you'll not have to train your employees on a skill that will only be required once the job is complete. For a lot of companies, manufacturing requirements keep changing seasonally. Labour hire enables you to adjust your workforce to suit the current workload. You, therefore, don't need to employ permanent staff that will not be needed when the peak season or project is complete.
    3. Trying employees before hiring. For your permanent personnel requirements, you may use labour hire to discover a worker's compatibility with your company prior to hiring them. On-job evaluation is the best way to find out whether an employee will be a fantastic fit.
    4. Short notice and emergency cover. Sometimes worker shortages can't be foreseen such as when a worker falls ill or gets injured. Because labour hire companies have vetted candidates ready and willing to begin work with little notice, you can find a temp to pay your labor shortfall minimising interruptions.
    5. Robust recruitment processes. Labour hire firms are experienced in recruiting labour and have developed processes to ensure that candidates supplied to your organization are the best for your needs.
    6. Bulk recruitment. Because labour hire companies have large databases of pre-screened employees, they have the ability to fill a large number of positions concurrently without compromising the quality of labor provided.
    7. Network. A labour hire firm will have a larger network for finding workers than any company could have. The wide network enables them to fill any vacant position you've really quickly.
    8. Market knowledge. Labour hire firms have an in-depth understanding of the labour market for many industries they recruit for. They understand current hiring complexities, current salaries and available skill-sets and will offer viable alternatives for hard to acquire skills. Their knowledge lets you get the right individual to fill a position regardless of the prevailing market conditions.

    What's the best option for your organization?

    The kind of firm you select for your company greatly depends on your needs. If you need a one-off hire for a permanent employee, a recruitment company would be a good fit.

    If your business has varying and short-term labour requires, though, a labour hire company would be the better choice for you since it would greatly reduce recruitment costs and time. Businesses that use labour hire firms can tap into vast pools of highly trained workers at any time to cater for emerging labour needs without the time-consuming constraints of recruiting and training -- or the expense of hiring permanent workers.

    Aspects of a great recruiter

    Whichever solution you select, make sure the recruitment or labour hire firm covers the following aspects to ensure that you get quality services.

    1. Particular industry expertise. Unless your recruiting needs are extremely general, make sure that the recruitment firm you select has the capability to recruit for your specific industry. Otherwise they will fight to offer the best labour for you. A good worker is hard to find. The recruitment company that you choose should, therefore, have several recruitment strategies to ensure they get the best worker for you.
    2. Robust screening procedures. Screening is important to ensure that your company gets the employee they need. A fantastic recruitment firm should have processes in place to make certain that all candidates brought forward will suit your requirements.
    3. Registration and compliance. The labour agency you choose should be registered with the appropriate government authority and needs to be in compliance with all labour laws and ethics. This can help protect your businesses reputation. If a labour hire provides guarantees for their services, it shows they are confident in their systems, and you can hold them accountable if they fail to provide what you are searching for. An agency may boast of their ability to fill 100% of customer vacancies, but only some of the candidates make it through a year of employment. Consult your agency to provide hard numbers for the retention of the candidates they supply. An agencies job doesn't end when they've provided the worker. They need to check in frequently for at least 6 weeks to ascertain the candidate is progressing nicely and help out with any emerging issues.
    4. Reliability. A good agency should be able to deliver on time as flaws may be quite expensive in terms of productivity. Prior to settling on a recruiter, request recommendations.
    5. Relationship building. For a company to recruit efficiently for your business, they should build a relationship with you to understand your organization culture and the sort of candidates that will fit well into the organisation.
    6. Communication. Good two-way communication has to be maintained to make sure that each party plays their part in the recruitment process.

    Next time you are looking to employ staff either on short-term or long-term basis, bear in mind that a recruitment business is not the only labour provision solution available; evaluate your needs carefully to get the solution that will work best for your organization.

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