When it comes to a labour hire agreement there are several things that are normally misconstrued by people. The first area of misconception is about the way pay and charge rates are calculated in these cases. The term pay rate signifies the wage paid to employees on a per hour basis. The charge rate is basically the fee that is levied on the client who happens to avail the labour. There are a number of factors that need to be taken into consideration when it comes to such cases. They may be enumerated as below:
lIndustrial agreements
lStatutory on costs at national and state levels
lWorkers’ compensation levies
lComparable pay rates for employees of the clients
Maintaining workplace harmony
You also need to keep in mind that if you wish to maintain harmony at your workplace you pay your workers who have been recruited by labour-hire agreement the same money as your regular employees. You would not want any pay related dispute at your workplace, would you? As far as charge rates are concerned the following items have a significant bearing on the same:
lPersonal protective equipment (PPE) supplied
lPayment terms
lCasual loading
lSuperannuation
lGross margin
lPayroll tax
lPreferred supplier agreements
lCompetition
How are gross margins calculated?
So, this is something that you need to know in the context of a labour-hire agreement. The gross margin in these cases is usually calculated as a percentage value of the pay rate. However, in some specific cases, you may consider the same as a certain dollar markup. One of the questions that are asked quite a lot in these contexts is the way in which the labour-hire workers are screened. This is a great question to put forward to someone who is likely to recruit for you in days to come.
The questions that need to be asked in this context
When it comes to this part of a labour-hire agreement there are a few things that you need to take into consideration. The worker in question should have at least 3 working references and at least 2 of them have to be highly positive. References should be inclusive of the following factors:
lWork descriptions
lAttendance records
lAttitudes
lSocial skills
lLongevity in the role
lSafety issues
lOverall skill level
The workers would also need a reference from the last place that they worked. They should also have a complete written resume that should contain verifiable work experience.
Conclusion
When you are screening workers for a labour-hire agreement you should also ask for copies of present trade papers as well as licenses. They should also have access to suitable means of transport that are in line with the requirement of the work. This needs to be verifiable as well. Their internal safety induction needs to be updated as well. You should also conduct personal interviews with them and find out if they are compatible with your work or not.
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