Temp-to-hire roles are driving better hiring decisions among both employers and employees.
By Marta Chmielowicz
Talent has long been considered a competitive differentiator for organizations as they seek new ways to thrive, but success in the modern business world increasingly hinges on one capability: agility. Organizations need to be flexible, adapting to dynamic market needs while offering candidates and employees a positive experience. Faced with growing innovation and competition, skill sets and expertise—rather than worker type—are the priority.
Given this trend, it is no surprise that Ardent Partners’ The State of Contingent Workforce Management 2018-2019 study reports that 41.5 percent of the average enterprise’s overall workforce is comprised of non-employee labor, a figure that is nearly 2.5 times bigger than it was 10 years ago.
Many employers are turning to temp-to-hire working arrangements as a way to maintain a large, qualified, and flexible workforce at their fingertips. “Temp-to-hire provides a cost-effective opportunity for an employer to ensure that a candidate’s skill level and competencies meet the requirements of the position. In all cases, the employer benefits from the continued flexibility while having a larger and more diverse pool of candidates to choose from,” says Brian Knapp, head of MSP programs at Sevenstep.
While most contract roles are suited to temp-to-hire engagements, Knapp suggests that industries like IT, which require complex skills, face a high degree of variation in skill level across candidates, and contend with ongoing talent shortages, will benefit most from this approach. Mick Fecko, senior managing partner at endevis, says that the engineering, finance, and accounting industries are also good candidates for this engagement type because they require skills that are difficult to quantify in a technical assessment or interview process.
“Many organizations find the temp-to-hire approach beneficial because they can employ people as contract workers first to effectively assess a candidate’s performance before extending a full-time offer. This enables employers to look at a candidate’s cultural fit and see their soft skills in action,” says CareerBuilder’s Chief People Officer Michelle Armer. “While hiring managers can ask pointed interview questions to analyze soft skills like critical thinking, other skills are difficult to gauge from a conversation.”
In industries where skills do not necessarily correlate with years of experience, Fecko says that engaging employees in temp-to-hire roles gives managers a risk-free trial period to assess their applicable hard and soft skills, their ability to meet deadlines, and their teamwork capabilities in the company’s unique environment.
But, according to Knapp, temp-to-hire roles are not just a way for employers to evaluate potential candidates; the “try-before-you-buy” mentality is a two-way street. Throughout the experience, candidates assess whether the opportunity aligns with their skills, personal values, and career goals—so companies need to make a positive impression.
“Temp-to-hire roles provide an opportunity for the candidate to further evaluate the position and company. This allows the temp-to-hire employee to evaluate the role itself, how they fit within the company culture, and whether it is a role that provides professional development,” explains Fecko.
Creating a Positive Candidate Experience
While contract-to-hire roles can provide valuable growth opportunities within an organization, Fecko says that many job seekers may be hesitant to give up the comfort of a full-time position for a less certain temporary role—even if it could result in a full-time assignment. As a result, organizations have to make the opportunity seem enticing and ensure that they are viewed as trustworthy employers once candidates accept the position.
HR plays a key role in this process. “Human resources professionals play a critical role by confirming and supporting the intent of the temp-to-hire scenario,” says Fecko. “By doing this, they instill confidence in the candidate’s decision to pursue the opportunity and open the candidate up to an employment scenario which the person typically would not consider.”
Armer says that by outlining the benefits and potential outcomes of a temp-to-hire position, HR leaders can attract job candidates to the offer. “In fact, a temp-to-hire position may include benefits that full-time roles do not, such as a chance for candidates to diversify their work experience, an opportunity for a job seeker to get their foot in the door of an organization they’re interested in working for, a way to expand their professional network, or a way to upskill or reskill to transition to a new type of role,” she explains.
Organizations that wish to implement an effective temp-to-hire program should consider three best practices:
1. Be transparent. For best results, employers should be clear about the scope of the temp-to-hire position from the very beginning, establishing the role’s expected responsibilities, the length of the contract period, and key milestones. According to Knapp, HR professionals should also detail the timeline for the onboarding process, define how the project supports greater company goals, and delineate how compensation and benefits will change during the transition from temporary to full-time employment.
In addition, organizations should also be honest about their reasoning for choosing a temp-to-hire arrangement. “If the position is temp-to-hire strictly due to policy, budgeting, or some other non-performance-related reason, that should be shared,” he explains. “Similarly, if performance is being measured and an offer is contingent on candidate-controlled factors like progress on a specific project, integration with the team, or a demonstration of skill, that should also be shared.” This eliminates contractors who are only interested in temporary roles while simultaneously attracting those interested in full-time employment.
Transparency at the onset can save organizations legal and financial troubles later on, Armer says. “Two key challenges of the temp-to-hire approach are wasted training resources and legal concerns. Temporary workers will require training regardless of their skill sets, which can take time and money. If these temporary workers don’t become full-time employees, the investment may not always be worthwhile in the long run. To avoid any potential legal issues, it is important that the contract is clear at the outset so temporary workers understand which benefits they are and are not entitled to receive.”
2. Treat temporary workers like full-time employees. Since temp-to-hire workers are recruited with retention in mind, organizations should approach their hiring process the same way that they would a full-time employee. Specifically, Armer suggests that HR leaders evaluate candidates for culture fit, interest in the company, and skill set, and ensure that all potential employees have gone through the necessary levels of background screening. Information about company culture, mission, organizational structure, and benefits should also be shared early on.
But the full-time mindset doesn’t stop there: Temp-to-hire employees need to be managed with the same care and consideration as permanent workers. “An organization can make a good impression by treating temp-to-hire workers with the same respect that they give to their core employees,” says Fecko. “Make it a great experience, let the temp-to-hire worker feel your employee brand. Allow their voice to be heard and include them when making decisions which they are qualified to make on their respective projects. Engage them in positive working relationships and communicate with them on their performance and impact on the organization.”
According to Armer, providing constructive feedback and growth opportunities are additional strategies for retaining high-performing temp-to-hire workers and making them feel like an asset to the team. “It is not only important that employees feel their time is valued, but also that they feel there are learning and advancement opportunities.”
3. Model success. The final component of a successful temp-to-hire strategy is providing encouragement and evidence that temporary employees can—and have—achieved great things at the organization. Knapp says that one way that HR leaders can illustrate success is by introducing new temp-to-hire workers to employees who have successfully made the transition from temporary to permanent employment.
“HR professionals can reference similar situations they have had with other temp-to-hire opportunities and show the career paths and successes other individuals have experienced,” says Fecko. “This type of openness further develops trust and promotes potential opportunity for growth.”