A-Z Guides
Secondment
What is Secondment?
Put simply, a secondment is the temporary loan of an employee.
This covers a number of possible scenarios:
- Intra-company secondment: This is where an employee is asked to work in a different department for a set period of time. There may be sufficient flexibility in the employee’s terms and conditions of employment to require such a move, and in any event these switches can often be easily agreed on a relatively informal basis, with little prospect of legal issues arising.
- Intra-group secondment: This is where an employee is asked to work for another employer in the same group of companies. Again, a switched-on employer that is part of a group will already have catered for this possibility in contracts of employment. The terms of the secondment also tend to be easier to agree when the seconding and host employers are related undertakings.
- External secondment: This is where an employee is sent to work for an external employer, such as a client or customer of his normal employer. These arrangements tend to be put on a more formal footing. Depending on the nature and length of the secondment, disputes can often arise further down the line where the seconding and host employers have divergent commercial interests.
Secondments need to be managed carefully and supported with a clear agreement between the employee and the area that the employee is being seconded to.
What are the benefits of secondment for employers?
Every employer faces difficulties from time to time in deploying resources effectively. Being able to control the assignment of tasks and temporarily manipulate headcount through secondments is therefore a significant benefit. This is especially the case where the employer’s business needs to react quickly to ever-changing demands.
An employer that experiences an upsurge in work in one of its departments may be reluctant to commit resources to it by recruiting new personnel on a temporary or permanent basis. Where the existing workforce has sufficiently transferable skills, and where quieter departments can spare the staff, intra-company secondments may be the perfect solution. This allows the employer to meet the spike in demand and resume normal service when it subsides. The same logic can apply to more predictable business needs, such as cover for maternity absence.
Conversely, secondments can be used to tackle a downturn in work. If an employer considers that a drop off in work is just a temporary blip, it may be wary of implementing redundancies that leave it unprepared when demand picks up. An external secondment, where the host employer picks up some or all of the secondee’s salary costs, can be an ideal solution for the struggling seconding employer.
Whether or not there are upsurges and downturns, secondments can also be a good way to develop the skills and contacts that an employer has at its disposal. Opportunities for growth within a particular department or company may be limited, and an intra-company, intra-group or external secondment can unlock an employee’s potential. This has obvious benefits for the employee in terms of personal and career development, but is also a relatively easy way for the employer to invest in its people.
Similarly, secondments can help the seconding employer develop good relationships with the host employer, who in turn gets manpower and an external perspective on its business. External secondments to customers and suppliers can be an excellent business development tool, and can encourage valuable secondments in the other direction.
What are the disadvantages of secondment for employers?
Moving staff around can be challenging and secondments are no exception. Whilst a secondment might look like a neat solution on paper, employers need to consider the human aspect and the effect the arrangement will have on the workforce.
From the seconding employer’s perspective, the main pitfalls are to be found in selecting the secondee and filling the vacuum. In some cases, the host employer will request a particular secondee, which simplifies matters if the request can be accommodated. If it is up to the seconding employer whom to send, care needs to be taken. Which employee will make the best impression? Who will manage to cope with the upheaval, flitting from one working environment to another and then back again? If you let them go, are you confident they will come back at all?
The seconding employer also needs to be careful how it deals with the impact of the secondment on the employees who stay behind. It is likely that some of those employees will need to take on extra tasks and responsibilities, and perhaps for no extra reward. Add to the equation that they may already be disaffected due to having been overlooked for the secondment opportunity, and the neat solution on paper has the potential to be an employee relations time bomb in the office. In addition, where the secondee is a key member of the team, it is worth asking whether the seconding employer really can afford to let them go at all, even for a short time. There is often a careful balancing act between accommodating secondment requests from important clients and ensuring the stability of the team from which the secondee would be drawn.
From the host employer’s perspective, the value of the secondment needs to outweigh the difficulty of merging the secondee into the business. Any new recruit can upset the balance of a team, and problems can be exacerbated where the new recruit remains employed by someone else. The secondee needs to get up to speed with the host employer’s ways of working and follow the day-to-day instructions of its management, but ultimate responsibility should remain with the seconding employer. That is a line that many employers (and secondees) find difficult to tread.
Conclusion
Managed properly, secondments can be of great benefit to all concerned, and it is no wonder that secondments have proved a popular tactic for businesses in the recent recession. They can offer much needed flexibility for employers when recruitment of permanent is not viable either due to cost or lack of supply. Seconding and host employers who invest enough time in planning a secondment and managing its progression should each reap significant rewards – and so should the secondee.