Contract to Hire

There are so many horrible hiring practices commonly used today one hardly knows where to begin. One of the most obviously poor is the concept of “Contract to Hire” positions.  The concept is simple: You hire someone on a temporary contract and, if all things work out well, you hire them on as a full time employee.  The idea being that the firm can “test drive” the employee for six months and make a sound hiring decision.  Maybe on the surface this feels like a huge win for the employer and the employee, of course, gets to test drive the employer.

But if we look at the idea from an employee’s perspective the misguided nature of this approach becomes very obvious.

There are essentially two types of workers: consultants and traditional employees.  At least people who desire to be one or the other.  Consulting is a unique way of working and a certain percentage of professionals prefer it.  Most workers want to be employees with all of the stability and benefits that that implies.  Very few people desire to be consultants.  It is a very high stress way to work.  This doesn’t mean that people don’t change over time, it is common for young professionals to like consultant work and desire to change to full employment at some later point in their careers.

The description above shows the problem with the contract to hire approach.  Which person do you hire?  The thought is that you will hire the later, the person wanting to be a long term employee with good stability and benefits who seeks out the contract to hire position in the hopes of becoming an employee.  One problem there, however, and that is that people who want to be stable employees don’t want to contract first.  Everyone knows that contract to hire means “contract with little to no chance of being hired afterwards.”  So workers seeking regular employment will only turn to contract to hire positions if they are unable to find regular employment leaving the employer with a strategy of only hiring those that are failing to find work anywhere else – a weak strategy at best.

The other risk is that consultants will take contract to hire jobs.  In these cases, the consultants take the position with no intention of accepting an offer at the end of the contract.  The company may spend six months or even a year training, testing, nurturing and convincing the consultant to love their job and when it comes time to hire them, they get declined.

There is no positive scenario for the contract to hire.  At best you hire a consultant who’s work style opinions are changed by the amazing nature of the work environment and magically they don’t get restless after accepting a position.  But this is far more rare than contract to hires actually attempting to hire someone at the end of the contract.  In the real world a company engaging in this practice is reduced to either hiring the least hireable or consultants with little to no intention of entertaining the “bait” offer.  This also leave the company with the belief that it has a carrot to dangle in front of the consultant when they in fact have nothing special to offer.

It is a case of an employer looking to take advantage of the market but, without thinking it through clearly, is setting themselves up to be taken advantage of.  The best employee candidates will bypass them completely and full time consultants will see the opportunity to strike.

The idea is simple and applies to all hiring.  Don’t hire a person based on factors that don’t apply to the actual job.  Hire employee types for employee positions, consultants for contract positions.  The same as you would not attempt to interview engineers for marketing positions – in theory someone has crossover skills but you eliminate almost any chance of every finding the right person.  Hire honestly to meet your needs and many problems will be eliminated.