I recently learned that some companies have a policy of intentionally hiring people as temps as a probationary method, not giving them the same benefits as regular employees, telling the employees outright that this is a probationary measure and that they will (may) be hired on as permanent employees.
I’m talking about someone who is recruited by an agency to be a permanent employee of XYZ Company, only to discover that the actual offer is a temp job that will (supposedly) lead to a permanent job at XYZ, if the employee proves satisfactory.
What do you folks know about this process? How many of the people hired in this way actually end up with the permanent jobs that are dangled in front of them? How long does someone typically have to be in the temp job before getting the permanent job, if they do? Is the temp employee actually an employee of the “hiring” firm, or are they working for a temp agency until their job becomes permanent, if it does? Do you know anyone who has done it?
This seems unbelievably sleazy to me. Am I missing something here? Is this legit?
My gut reaction is that this is sleazy too. Is it instead of a probationary period?
I think companies can do what they want in terms of how they hire but I would probably not be too excited about working for a company that wasn’t more transparent in their hiring process.
Seems like a bait and switch to me if it was supposed to be a permanent job.
I cannot answer all of your questions but yes it is a common practice and many reputable companies hire in this way. Some of your questions might be addressed in each specific employment agreement. If it is not, all those questions can be asked.
I think having something like a 90 day probationary period after being hired isn’t unusual but what is outlined in the OP does seem unusual and kind of shady to me.
It’s fairly common in my community. A young woman we are good friends was hired this way. She was an employee of temp company and her paychecks came from temp agency. For her she had been trying to get a job at a certain company and not having any luck. Someone who worked in HR at that company suggested she go through a specific agency. She worked there for a fairly long period of time in a great position. When the company did a big layoff it was able to easily let the temporary agency employees go. A few jobs later she went back to that company on a temporary assignment and was hired on permanently. She has been a permanent employee for over five years now.
I think some companies do it because the temp agency does the legwork on recruiting and vetting the workers. In the cases I know of the employees were well compensated but got no benefits.
Often the employee is an employee of the temp agency and contracted to the ‘real’ employer. Any health insurance and other benefits, like holiday pay and vacation time, are provided (or not) by the temp agency. The time with the ‘temp’ agency is entirely up to the temp agency and the employer. I worked for a long time through a temp agency until the firm no longer needed me. A few years later, the firm hired me as a contractor directly so I made more than I made through the temp agency, but never did get hired permanently and I had to pay my own self employment taxes and own insurance.
My friend is a tech person contracted to a Visa card processor. He’s employed by one firm (and gets his benefits from them and his paycheck) but spends 100% of his time at the office of Visa. Visa sets his hours through the employer and handles any employee issue through the contracting company. He was told Visa may hire him permanently after a year but may not.
When I worked at a government agency, our computer techs were contractors. We had ‘real’ techs in Washington DC but the ones in the field were contracted. It was too expensive to hire and train techs in the field and using contractors is easier and cheaper.
There is also a situation where the employer doesn’t offer any benefits for the first 90 days but you are an employee so your time is accruing (vacation time, annual review date, etc).
I don’t think it is a scam, just a different way to hire employees. My brother worked 39 hours per week for the city of Denver for YEARS because they didn’t want to offer benefits, and since he wasn’t ‘full time’ they didn’t have to offer them. THAT was unfair. Now ACA calls full time 32 hours per week, so many employers have two part time employees rather than one full time one.
The concept of contract to hire is very common in the IT industry. I get offers like that all the time. I never take them (not interested in the “to hire” part) - sometimes a client will decide to give me the contract anyway. As long as both sides make their intentions clear and the person gets paid for the contract portion, I don’t see a big issue. Either side can decide they’d rather not follow through with the hiring part.
My friend’s D was hired as a temp in the UK. They really liked her and eventually they hired her as a full time employee.
I have a friend who was a contractor. She was hired to help with projects. After awhile, she received several job offers with the company and finally accepted one.
There are many ways to get hired, starting as a temp or contractor are among those ways.
Someone I know is being recruited in this way. Apparently the recruiter is being evasive about how long the temp period is before the person would be brought on as a permanent employee. This is not “contract to hire,” because contract employment is different than temp employment in technical ways that I don’t understand.
I wouldn’t particularly be attracted if a recruiter told me that if I worked for some undefined length of time and they LOVED me that I MAY get hired.
I’d only accept the offer if I was really interested in working as a temp and the hours and benefits the temp agency provided were acceptable.
Sone “temp” jobs are really multi-level marketing sales—quite a few of the “jobs” our friends’ D& SIL were “offered” by the temp agency were sales, commission only, no wages, no benefits. Not sure how it was legal and they didn’t do any of those.
My husband occasionally does that when he sees a good fit for a need within his group but does not have a budget for a permanent position. It is way easier for him to justify a temp hire than a permanent one. Then, when the company gets “hooked” on the new employee’s results, they are more willing to find a budget for that person so the work can continue. Nothing sleazy about this… it is not done with the purpose to test out the employee, and the new hire is not promised a permanent job, but very often it ends up being a permanent one.
IBM has what it calls “supplemental employees”. The positions are paid close to industry-level salaries, but no benefits. They may or may not lead to permanent positions. These jobs have mixed reviews on Glassdoor.
I have the same exact experience as @BunsenBurner 's H. We pay market salaries to temps. We are usually not allowed to keep them for over 6 months, but exceptions are possible while permanent positions are getting approved. Some temps become very desirable and get several permanent position offers from different departments.
It can work in the individual’s favor too. If you’re already a freelancer and decide you would like to be a regular employee, then taking a 3 month gig with a company can be a great way to see if they are a fit.
The benefit to the individual is that leaving a regular job after 3 months because it “didn’t work out” raises red flags with future employers, while leaving a 3 month contract after 3 months doesn’t have any negative connotations.
Jobs like this should be advertised as “contract to hire” from the beginning though. Bait and switch is pure sleaze.
A lot of govt jobs have some element of this. You get hired and then look around and try to get permanently hired and transfer to the position(s) desired. Sometimes the original hiring is for a temp position or even a contract position and no benefits. If it works well, it’s a win/win. No recruiters are generally involved.
Cardinal Fang, the ‘employee’ had to know who the employer is or if they are an independent contractor.
Company needs a job done. It can:
1 Hire an employee as a full time new employee, and offer the benefits it does to all employees. The Company controls the employee’s time, working conditions, decision making duties, supervision, etc. and pays according to law, issues a W2, withholds taxes.
The company can give a contract to an outside employment agency. the contract is between the two companies, and Company B will provide employees to do XYZ, on the Company A's site, during these work hours, etc. If the person isn't doing the job, Company A will tell the contractor, and the contractor has to deal with the employee, the tardiness, the bad work etc. The Contractor deals with payroll, taxes, etc. The employee is an employee of the temp company.
3 Company A can contract directly with the ‘employee’, but then the company gives up a lot of control. It can write the contract as a ‘statement of work’ and the contractor agrees to do the work at the site, between the hours of 9-5, but if the work isn’t done correctly the ‘employee’ isn’t fired, the contract is terminated. The ‘employee’ isn’t entitled to benefits, to breaks (unless they are in the contract), to join the 401k program, to the Company kicking in with insurance or time off. All that has to be written into the contract. This is what many companies do when they want to ‘try out’ an employee.
When Microsoft first started, all the workers were contractors. That went on for years, until the contractors sued and claimed they weren’t contractors because they didn’t control their own working conditions, were subject to supervision, etc., and were in all ways employees except they didn’t get benefits and most importantly didn’t get stock options which were worth millions. Court agreed that they were employees.
This style of hiring is common in government, but it’s different from most private sector jobs since government positions that are staffed as ‘permanent’ have a lot more stability and benefits. Basically once you get the permanent position, you’re pretty much guaranteed some form of full time employment forever barring some extreme level of incompetence or other ridiculous workplace behavior. The probation periods for government permanent hires are longer than 90 days. A bad permanent hire in government can be really really costly…
For most government positions, other than highly technical/specialized fields, people start in defined-term contracts (usually 1-2 years) with almost full benefits, then try to get into a permanent position - all time as a term public servant is pensionable. Getting the notice of government hiring managers while working contracts (through private firms or as independent contractors usually with no benefits) or as casual staff is pretty common too. When government agencies struggle for money, it’s common to have people continue on term contracts that get renewed over and over again for a long time (like 10 years)… because there isn’t enough wage money to reclassify the position as a permanent position.
Not being upfront at point of hire though is not ok. If a job is a fixed term that may become permanent (but isn’t budgeted as such), the candidates should be told. There’s a difference between a term with possibility of permanent contract vs. permanent contract with fixed probationary period. It sounds a little like the industrial postdoc positions being offered by a lot of pharma companies these days - 1-3 years being paid 50% of a senior scientist with no guarantee of permanent employment (but everyone telling them that it’s a pathway to employment!).
I think this type of thing (and worse) happens in areas where jobs are more difficult to get. Employers do it because they can. Where I live we endured the ten year recession where things have been stagnant for so long that salaries haven’t move much and employers have “been in the driver’s seat.” I’m noticing things are starting to change.
I’ve seen this type of probationary contract employment, interestingly mostly in the engineering profession. But also in media and similar jobs. But the employees fully understood the terms so it’s not sleazy in my book. In one case the engineer was doing a good job but the company’s budget had imposed a hiring freeze on permanent employees. He had to wait almost two years before he was offered a permanent position.