IT contractors kept in stationery cupboard

A recruitment firm has claimed that departmental managers are passing off IT contractors as items of stationery and other sundries in a bid to circumvent corporate recruitment freezes.

Parity Resourcing Solutions estimates that the practice of hiding the cost of contractors on other parts of the balance sheet could affect up to a fifth of UK businesses.

IT departments are among the worst offenders because they tend to rely more on contract staff to gain access to the latest in-demand skills or to meet project deadlines.

Joe King, managing director at Parity, said: "Departments use all sorts of methods to disguise what they're doing.

"Controlling maverick recruitment is a challenge for all companies, particularly during a headcount freeze.

"Human resources departments face an ongoing battle in trying to make their line managers follow the proper channels."

King warned that the practice is putting some businesses at risk.

"There's a whole raft of new legislation around deploying temporary staff, and unless managers are using HR procurement to engage contractors they may be exposing the company to risks they are not personally aware of," he said.

Parity suggested that the main problem is that if companies do not engage and manage contractors according to accepted procedures, they could inadvertently be conferring on them the status of company employees.

This in turn would give them entitlements to pension rights and other benefits normally only granted to full-time staff.

"These risks always exist but there are well-established processes and procedures you can follow to minimise them," explained King.

"For example, a department should not exercise disciplinary procedures directly with an agency worker because this implies an employer-employee relationship.

"Any discussion of that nature should be conducted through the agency. HR departments understand these subtleties, but line managers are often unaware of them."