What is body leasing?

Since technology is ever-evolving, the software development industry faces the challenge of finding and employing the best IT specialists, both for startups and for large corporations with established market positions. Moreover, it is an expensive and time-consuming task. As you already know, many IT companies rely on outsourcing models to get their software development projects done. 

Body leasing is one of the popular outsourcing models that is considered a way to access the best IT talent without having to invest in hiring and training them. It is also known as staff leasing or staffing. It is applied in situations where an organisation needs an employee with a specific set of skills for a project or a limited amount of time. Now, you are about to learn how it works, its benefits, etc., in this article. 

What are the benefits of staff leasing?

There are numerous benefits that body leasing can provide to its customers. The first and foremost advantage is the flexibility in hiring and staffing it offers. Without having to commit to long-term hires, businesses will be able to use temporary employees for specific projects or positions. It will be beneficial to companies that undergo seasonal fluctuations in demand or need to staff up quickly.

  • It also becomes a financially advantageous choice for them because the service provider will handle all contract-related expenses, such as payroll, taxes, and benefits.
  • For small or midsized businesses that lack the resources to handle a large workforce on their own, this can be extremely helpful.
  • Another benefit is that it can provide access to qualified workers who are located abroad for remote positions.
  • You can scale your project’s team up and down to meet the changing scope of the project. You can easily fire the tech experts or purchase them from the body leasing company once the project is finished.
  • The service provider takes care of the administration, which may call for specialised training and familiarity with international payroll, employment law, and tax regulations.

What are the drawbacks?

You read about the various advantages of staff leasing in the above section. Now, before you hire staff from a body leasing company, you should also be aware of the disadvantages and pitfalls of this kind of outsourcing. Here are some of them:

  • The first drawback is that it can cost more than traditional outsourcing when you hire specialists from your location. It is because the salaries are the same and you will also need to pay the margin. Therefore, this outsourcing model typically entails employing experts from more affordable locations. 
  • You cannot expect the same level of loyalty and dedication from the leased employees as from the in-house or offshore specialists. 
  • Sometimes, there can be dissatisfaction with the work of an employee, and you may end up replacing them quickly, leading to unpredictable situations and project delays.
  • There may be risks associated with the code and the confidentiality of business data.
  • If the hired staff members overestimate their level of English language competency, they might have trouble communicating.

Is it the right choice for your company?

Although there are many benefits it can offer, you should check whether body leasing is a good option for your business. Companies that can benefit from the model are those that have short-term projects, need access to specific skills, or are looking for cost savings. It is also suitable for companies that:

  • Already have an IT team and are capable of leading an IT project.
  • Understand which experts are absent from their team.
  • Want to lower labour expenses and save time during the hiring process.
  • Need to get started on the project right away.
  • Require personnel with specific expertise. 

In what situations is body leasing a bad idea?

Though it is not always the best option, staff leasing can be an excellent fit for many organisations. Direct hiring might be a preferable choice for businesses that need to fill long-term, strategic positions that are essential to their operations. Likewise, internal hiring might be more suitable for positions requiring a high degree of security or secrecy.

For businesses that wish to keep total control over their employees, it might not be the best choice. Direct hires might be a better option in these circumstances. Additionally, companies that are too small to profit from the additional resources or those with a large workforce may find it unsuitable. And for companies that would prefer to retain their employees in-house, staff leasing might not be the best choice.

How is it different from outsourcing?

Body leasing is more flexible than traditional outsourcing, as it allows companies to lease employees on a project-by-project basis. Companies can also choose to lease employees for a fixed period of time, allowing them to adjust their workforce as needed. Additionally, it can be cheaper for companies than outsourcing, as it requires less up-front investment. It differs significantly from traditional outsourcing in a few key ways. Some of them are:

  • While body leasing seeks to cover gaps in the internal client team, outsourcing entails hiring a team that bears greater accountability for the project’s outcome.
  • While outsourcing happens at the start of the project lifecycle, body leasing is an option you can choose for any stage of your project’s development.
  • When an entrepreneur uses body leasing, they employ a specialist for a set amount of time, usually to carry out a particular project. 
  • However, when it comes to outsourcing, the contract establishes the guidelines by which the service provider will deliver its IT experts to the client organisation. 

Now that you know a lot about body leasing, its advantages and disadvantages and others, you can make a more informed decision on whether this is a suitable option for your project. It is a flexible outsourcing model for hiring the lacking IT specialists with various competencies for a specified period of time for your in-house team. It is a very useful method to get started with your projects quickly and reduce the costs associated with hiring specialists. So, get started if you have already made your decision.

Interesting Links:

Body Leasing: what is it, for whom, and why?

Body leasing vs IT outsourcing – what is the difference?

Pictures: Canva

The author: Sascha Thattil works at Software-Developer-India.com which is a part of the YUHIRO Group. YUHIRO is a German-Indian enterprise which provides programmers to IT companies, agencies and IT departments.

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