Outsourcing, the thin line between what is legal and illegal

Did you know that more than 85% of businesses that hire this service do so only to save regardless of the mood of its employees?

Any worker who heard the word outsourcing has reason to tremble. Recruitment for this scheme system has as main objective the hiring of qualified personnel for specific tasks and areas where by same company does not produce cost-effective talent. So, qualified temporary recruitment.

But did you know that more than 85% of businesses that hire this service do so only to save money no matter the mood of its employees or large tax evasion?

According to a study by the ManPower Group México, talk of outsourcing is to speak of a recurrent by business practice for more than six decades around the world, however, what started as a great idea to capture specialized talent, it has become unfair practice to undermine the workers of their rights through precarious contracts separated from the distribution of profits and benefits, as well as non-compliance with tax and social security.

"Has been abused from the word outsourcing into the country, to have gotten from the firm of accountants, companies without prestige and all those who carry everything in order, everything has gotten into this concept, so that many companies prefer to call us outsourcing companies", says Monica Flores Barragan, general director for Mexico and Central America of Manpower.

Although there is no official figure, it is estimated that thousands of companies in the country (around 3,000) who are dedicated to providing these services of outsourcing, however, these billions, only 16 are given high before the Mexican Association of enterprises Human Capital (AMECH), which are those that comply with the approval by an international firm in its code of ethics recruitment processes and the alignment of their legal processes from procurement to finance and the IMSS.

But as in everything, the reality is different. Hundreds of companies hire these services with a single purpose in mind: saving money. This because 100% of your payroll, only 30% are on the payroll and under regulated laws, and this, in the best of cases.

However, this is not all, the personnel hired externally is high with a minimum wage, which is reported before the IMSS, while the remaining amount is provided through other bank accounts. Obtaining advantages for companies and disadvantages to employees.

Advantages and disadvantages of outsourcing recruitment
According to the AMECH, here are the benefits that companies have a specialized and legal outsourcing:

• Support the creation of employment.
• Possibility of having an organization more flexible and light.
• Ability to focus on the core and strategic part of your business.
• Reduction of the administrative burden.
• Ability to learn and evaluate employees in periods of testing or training.
• Reduction of legal and labor contingencies for which contracts the service.
• The cost of the service is fully deductible.

Furthermore, experts believe that these are the disadvantages to an illegal recruitment:

• There is a contract and therefore a disloyalty of the worker to the institution.
• There is a sense of belonging, therefore, low productivity.
• There is seniority for the workers, therefore, affect the work environment.
• There is increased risk of increasing the number of staff turnover, so it symbolizes more expenses in hiring and training.
• Lower the quality of service and product.

The desperation of legal vs. illegal
At a time where there is excessive competition, you are looking for the companies save costs and expenses to generate more profits, benefit that the illegal outsourcing companies provide. In addition, according to the expert of ManPower, costs by hiring a legal firm to a company of dubious origin are abysmal, it is a difference of almost 50%.

"We can't compete with someone who is half. It is impossible to compete with them, the problem is that the risks of fraudulent services are many and very high costs, as where there is an audit, a demand or an inspection, the company lose what you saved and more. It is a vicious circle, does not benefit anyone in the long run, it is a poorly understood mistake", says the specialist.

Tips for proper engagement
The first thing that must be taken into account is that the acquisition of outsourcing services is not a guarantee of long-term savings, but an option to hire specialized talent that the company does not produce, as well as a job advantage for those who are postulated in temporary posts. Having said that, the expert recommends pay attention to these points before hiring an outsourcing service:

• The company's reputation. Research background, reviews and company who are working with them.

• Check that the recruitment of staff is legal.

• Czech on a regular basis the compliance of contributions made in time and form.

• Verifies that prompted and paid the same salary.

• Before hiring, go to the company's facilities, may be shell companies.