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Temporary employment refers to a particular model of employment between two companies: the temporary employment agency (also called the lender) and the hirer. The process begins when a company (the hirer) has short-term or project-related staffing needs that it cannot meet through its regular employees. Instead of hiring a new employee directly, the hiring company turns to a temporary employment agency to temporarily “borrow” an employee. This has the advantage that the hiring company can respond flexibly to changes in staffing requirements without having to make a long-term commitment. The temporary employment agency, is the actual employer of the temporary worker. It concludes an employment contract with the employee and assumes all associated legal and administrative obligations, such as wage payment, social security contributions and vacation arrangements. In return, the temporary employment agency receives a fee from the hirer for supplying the employee, which usually corresponds to the employee’s wage costs plus a margin for the temporary employment agency.

Temporary employment (employee leasing) offers companies a wide range of strategic and operational advantages. Particularly in a constantly changing business environment, temporary employment enables companies to remain flexible and adaptable. A key feature of temporary employment is flexibility. Companies can respond quickly and as needed to staffing requirements without making long-term commitments. This is particularly useful in industries with seasonal fluctuations or for sudden projects that require specific expertise. In addition, companies can significantly reduce their hiring risk. The temporary employee can be tested for a longer period of time, minimizing costly mis-hires. Temporary employment is also popular as a recruiting channel to find and employ valuable professionals for specialized work. Temporary employment offers companies the opportunity to remain competitive and agile by allowing them to quickly and flexibly adapt their staffing strategies to current business needs.