Dear Just Ask Judy:
My client would like to bring a former employee back to work but cannot do so because the employee accepted a severance package last year that prohibits him from returning on a W-2 basis. Any suggestions on how I can help my client with this issue?… Stressed in St. Louis
Dear Stressed in St. Louis:
This question has come up a lot because of the “Great Resignation.” With rapid changes in the economy, it has become harder for many people to make ends meet. Going back to work as a contractor on a special project could be beneficial to both your applicant and your client company.
This is the perfect opportunity to use a third-party employer of record (EOR) service. I spoke to Angela Alberty of MyBasePay to get some guidance. Angela outlined the benefits of using an EOR service and explained how this can be a win-win situation for all!
Angela commented that a great resource for recruiters is this pool of experienced, qualified personnel who recently left their previous employers. An EOR can take the employee on as a W-2 and can collect the employee’s time, pay the employee weekly, and invoice the client company for hours worked. Your client is protected from unemployment claims and minimizes their overhead burden and risk exposure. Your applicant may not need a new career but merely wants to supplement their income. Since they are already familiar with the client company’s work environment, their qualifications and experience make them immediately productive.
Angela noted that an EOR also provides for withholding taxes, issuing W-2s, and offering a benefits package. For client companies that are faced with hiring restrictions but still need to keep their business processes flowing, it may be attractive for them to include a line item in their annual budget for contract labor. Contract labor through an EOR can be closely controlled and has no further cost implications and offers none of the long-term risks or burdens of direct-hire employees. This flexible approach will allow you to solve your client’s labor needs and will enable you to tap into a significant reservoir of talent!
I appreciate Angela taking her time to explain the advantages of establishing a relationship with an EOR service to bring these experienced workers back into the force. You can contact Angela at firstname.lastname@example.org if you would like more information on how she can help you!
Don’t let a severance package prevent you from making these placements!