Close Menu
    Facebook X (Twitter) Instagram
    • Our Story
    • Partner with us
    • Reach Us
    • Career
    Subscribe Newsletter
    HR KathaHR Katha
    • Exclusive
      • Exclusive Features
      • Research
      • Point Of View
      • Case In Point
      • Dialogue
      • Movement
      • Profile
      • Beyond Work
      • Rising Star
      • By Invitation
    • News
      • Global HR News
      • Compensation & Benefits
      • Diversity
      • Events
      • Gen Y
      • Hiring & Firing
      • HR & Labour Laws
      • Learning & Development
      • Merger & Acquisition
      • Performance Management & Productivity
      • Talent Management
      • Tools & Technology
      • Work-Life Balance
    • Special
      • Cover Story
      • Editorial
      • HR Forecast 2024
      • HR Forecast 2023
      • HR Forecast 2022
      • HR Forecast 2021
      • HR Forecast 2020
      • HR Forecast 2019
      • New Age Learning
      • Coaching and Training
      • Learn-Engage-Transform
    • Magazine
    • Reports
      • Whitepaper
        • HR Forecast 2024 e-mag
        • Future-proofing Manufacturing Through Digital Transformation
        • Employee Healthcare & Wellness Benefits: A Guide for Indian MSMEs
        • Build a Future Ready Organisation For The Road Ahead
        • Employee Experience Strategy
        • HRKatha 2019 Forecast
        • Decoding and Driving Employee Engagement
        • One Platform, Infinite Possibilities
      • Survey Reports
        • Happiness at Work
        • Upskilling for Jobs of the Future
        • The Labour Code 2020
    • Conferences
      • Rising Star Leadership Awards
      • HRKatha Futurecast
      • Automation.NXT
      • The Great HR Debate
    • HR Jobs
    WhatsApp LinkedIn X (Twitter) Facebook Instagram
    HR KathaHR Katha
    Home»Exclusive Features»Why is employee leasing even more important in this volatile period?
    Exclusive Features

    Why is employee leasing even more important in this volatile period?

    Saheba Khatun | HRKathaBy Saheba Khatun | HRKathaJanuary 23, 2023Updated:January 30, 20234 Mins Read28320 Views
    Share LinkedIn Twitter Facebook
    Share
    LinkedIn Twitter Facebook

    Employee leasing isn’t a new term for the HR fraternity. For the uninitiated, it is a business arrangement wherein a company outsources certain HR functions and responsibilities to a third party, which is commonly known as professional employer organisation or PEO services.

    “For critical projects, at times, organisations put together a squad of employees leased from different sources within the organisation and then try to deliver the organisation’s agenda.”

    Amit Sharma, head – HR, Zee Entertainment

    This PEO assumes legal and administrative control over the company’s employees, and certain employer responsibilities such as payroll, benefits administration, and compliance with federal and state employment laws.

    Amit Sharma, head – HR, Zee Entertainment, is of the opinion that in the near future, the employee-leasing model will be increasingly used.

    “It’s simply because at the time of need, it is often difficult to find a subject matter expert within the organisation”. In such situations, the organisation can quickly hire a gig worker on a temporary basis, to come and finish the job and move on,” he says.

    Mahipal Nair, managing director,  VP, HR, APAC and MD Trellix, who calls it a liquid workforce, shares that the popularity of this system lies in the fact that it’s easy to kind of get in and get out.

    “Any company in the formation stage can make best use of employee leasing to keep their costs under control,” he opines.

    “Any company in the formation stage can make best use of employee leasing to keep their costs under control,”

    Mahipal Nair,  VP, HR, APAC & MD, Trellix

    According to Ravi Mishra, senior VP-HR, Aditya Birla Group, “Globally, even the critical ones, are being leased out. In India, this practice is going to increase with time.”

    Sharma of ZEE, says, “For critical projects, at times, organisations put together a squad of employees leased from different sources within the organisation and then try to deliver the organisation’s agenda. Such squads have become very common in the typical new-age organisations.”

    However, the cost that an organisation incurs in doing so, is not viewed as an individual cost, it is always viewed as a project cost. Therefore, the time invested by the HR team or the finance team or anyone else is not as high as compared to a full-time employee at times.

    However, one has to be cautious on certain fronts when dealing with employee leasing.

    Expensive

    While PEOs can save companies money in some areas, the cost of using their services can be higher than handling employment tasks in-house.

    It can be more expensive than other forms of outsourcing, as PEOs typically charge fees for their services.

    “Globally, even the critical ones, are being leased out. In India, this practice is going to increase with time.”

    Ravi Mishra, Sr. VP-HR, advanced materials business, Aditya Birla Group

    Many companies have a hiring process which is very complex and time consuming. Such organisations depend on liquid workforce to fast track hiring. However, despite being a liquid resource, they fulfil the need of a full time worker. In the long run it can turn out to be expensive.

    Besides it also means depriving the hired resource of the benefits enjoyed by a regular employee. “This is an unfair practice,” opines Nair.

    Limited control and flexibility

    Some companies may feel that they lose control over their employees while using a PEO, making it more difficult to manage the workforce. Companies may have less control over the day-to-day management of their employees when using a PEO. Sometimes, these PEOs may be unable to accommodate a company’s unique needs or requirements.

    Confidentiality

    Mishra explains one of the main drawbacks of outsourcing employees. “It is a very calculative and statistical decision for any company to decide where and where not to use the services; and to make sure that the services do not impact the quality, privacy and confidentiality of an organisation’s processes, design and research.”

    Complexity and lack of transparency

    The process and agreements pertaining to employee leasing can be complex and may require legal and HR expertise to navigate. Some companies may also have concerns over the lack of visibility into the PEO’s operations and processes.

    Whether the company is new or established, if the work is critical and the cost is uncertain, employee leasing is a sensible option.

    Aditya Birla Amit Sharma employee leasing Mahipal Nair Ravi Mishra Trellix Zee Entertainment
    Share. LinkedIn Twitter Facebook
    Saheba Khatun | HRKatha
    • Website

    Leave A Reply Cancel Reply

    12 − eight =

    Related Posts

    The truth about lies: Why résumé fraud has become an epidemic

    June 13, 2025

    Social media is showing Indian workers what they’re missing—and they want change

    June 11, 2025

    When employees leave without notice, who bears the moral burden?

    June 10, 2025

    How this semiconductor company schools its talent for the AI age

    June 9, 2025

    QUICK HR INSIGHTS

    EDITOR'S PICKS

    The truth about lies: Why résumé fraud has become an epidemic

    June 13, 2025

    Redefining recognition: Why the future of HR leadership lies with rising stars

    June 12, 2025

    Social media is showing Indian workers what they’re missing—and they want change

    June 11, 2025

    When employees leave without notice, who bears the moral burden?

    June 10, 2025
    Latest Post

    L’Oréal expands employee share-ownership plan to boost engagement

    News June 13, 2025

    L’Oréal Groupe has announced the launch of its fifth global employee share ownership plan. This…

    From scrap to sustainability: GRP’s transformation story

    Quick HR Insights June 13, 2025

    In this powerful excerpt, Sanjeeb Lahiri, Chief Human Resources Officer at GRP Ltd, shares how…

    Coal India introduces new uniform dress code for employees starting July

    News June 13, 2025

    Coal India (CIL) is rolling out a new uniform dress code for its employees from…

    NDMC rolls out major employee-welfare measures

    News June 13, 2025

    In a bid to ensure employee welfare, the New Delhi Municipal Council (NDMC) has approved…

    Asia's No.1 HR Platform

    Facebook X (Twitter) Instagram LinkedIn WhatsApp Bluesky
    • Our Story
    • Partner with us
    • Career
    • Reach Us
    • Exclusive Features
    • Cover Story
    • Editorial
    • Dive into the Future of Work: Download HRForecast 2024 Now!
    © 2025 HRKatha.com
    • Disclaimer
    • Refunds & Cancellation Policy
    • Terms of Service

    Type above and press Enter to search. Press Esc to cancel.