The main purpose of outstaffing is to reduce administrative and financial costs for the customer. Instead of independently organizing the process of hiring and retaining employees, the customer can use the services of an outstaffing company that takes over these functions.

Outstaffing can be especially useful in situations where the customer temporarily increases the volume of work or needs specialized personnel for a limited period. Also, this method can be used to reduce the risks associated with personnel management and for greater flexibility in the management of human resources.

How does outstaffing work in Ukraine?

Outstaffing is the process by which a company outsources work or services to another company that provides the necessary personnel to perform these tasks. Here are the main steps involved in the outstaffing process:

Agreement between companies: The client (the company in need of labor) enters into a contract or agreement with the outstaffing company. This document defines the terms of cooperation, including work requirements, deadlines, scope of services and other details.
Search and selection of personnel: Outstaffing company is responsible for attracting and selecting the necessary employees to perform the work. It can use its own resources, such as candidate databases or professional networks, to find suitable candidates.
Formation of labor relations: After selection, employees become employees of the outstaffing company. This means that legally they do not work for the customer, but for the outstaffing company that acts as their actual employer.
Provision of labor to the customer: Outstaffing company includes enlisted workers in its staff and allows them to perform work for the customer. The customer has the opportunity to control the work performance process and demand from the outstaffing company the fulfillment of the requirements set forth in the agreement.
Management of labor relations: Outstaffing company provides management of all aspects of labor relations with its employees, including wages, payment of social benefits, compliance with legislation, etc.
The main advantage of outstaffing is that the customer can get access to the necessary workforce without the need to independently maintain staff and all related administrative and financial costs.

Outstaffing functions

As part of outstaffing, clients are provided with a full service, which includes the following types of services:

• hiring and firing of employees;
• control of staff compliance with labor duties;
• personnel administration, record keeping;
• calculation, accrual, payment of wages;
• calculation of taxes and other mandatory payments on wages and their transfer;
• resolution of labor disputes, conflict situations;
• labor protection services and employee training.
• Advantages of outsourcing in Ukraine

Outstaffing is a useful tool for many companies because it offers a number of significant benefits:

Saving time and resources: The customer does not need to spend his own time on searching, selecting and managing personnel. All these processes are performed by an outstaffing company, which frees up the customer’s resources for more efficient use.
Flexibility and speed of response: The customer can quickly attract the necessary resources in the event of an increase in the volume of work or the appearance of temporary projects without the need to conduct long processes of hiring and training new personnel.
Minimization of risks and costs: Outstaffing company assumes responsibility for management of labor relations, payment of wages, social benefits, compliance with legislation and other aspects related to personnel.
Access to specialized knowledge and skills: Outstaffing allows the customer to engage professionals with the necessary specialized knowledge and skills that may be difficult to find in the domestic labor market.
Focus on core business tasks: The customer can concentrate on their core functions and strategic tasks without spending time on operational aspects of personnel management.
Ability to test employees: Outstaffing allows the customer to try out employees for a short period of time or on a project basis before considering them for permanent employment.
Reduction of costs for personnel management up to 20-27% due to optimization of office management and reduction of overhead costs.
Reducing the burden on the company’s own personnel department.
Concentration of management attention on strategic tasks of business development and management, getting rid of routine tasks.
Prevention of labor disputes and quick resolution of conflict situations with employees.
Minimizing the risks of labor law violations and fines for the company.
Full control over the work of employees who are involved in the performance of labor duties under the outstaffing contract.
All these advantages make outstaffing an effective tool for optimizing human resources management and increasing business flexibility in changing market and economic conditions.