Temporary agencies in organisation - Essay Example

Generally, client organizations divide its workforce between core and peripherals. Core workforces are derived within the organization, while peripherals are obtained outside the organization. Literature indicates those firms are responsible in making the decision on the jobs that should be retained for the permanent employees and tasks to outsource (Booth, Francesconi and Frank, 2002). Outsourced tasks require less organizations skills and knowledge such as routine. Based on this model, firms distinguish core labour in order to reduce turnover of skilled workers.

In other words, the addition of the temporary agency staff in a firm helps to make quicker adjustments of the number of staffs when need arises. Therefore, during economic contraction, firms hire the temporary agency workers. The firm will no longer have the need to sack the permanent members of the workforce (Forde, 2000). In addition, the firm may opt to use temporary staffing agencies to reduce the increasing labour costs. Research indicates that most temporary agency workers receive less pay compared to the permanent members of the workforce (Booth, Francesconi and Frank, 2002).

However, this may differ between the bottom and top end of the labour market. In addition, firms are able to reduce operation costs by reducing liabilities such as holiday pay sick pay and maternity cover, although this may differ in various countries. In some countries, the temporary agency workers are entitled for payments. Moreover, the use of the temporary agency workers reduces the fixed cost of hiring permanent staffs. Outsourcing some functions allows a firm to reduce their non-core proficiencies.

Therefore, the firm has more time to focus on its main functions. The client organizations get opportunity for screening the temporary workers for potential permanent employees at low cost. Hiring core workforce from a pool of temporary staff can be