On-Roll Vs Off-Roll Employees

For any business, recruitment is one of the most significant investments of resources. On-roll jobs have always been the traditional means of employment for a company, as they offer employees multiple benefits to make them feel secure. However, there are other individuals who work for the company on a contractual or consultant basis. They are off-roll employees as their remuneration is solely based on their work and does not include any bonuses. On-roll and off-roll employees both come with their unique sets of pros and cons. So, it is vital to understand the fundamental differences between on-roll and off-roll employees, to make the right hire according to your company’s needs.

Post a Job

On-Roll Jobs

An on-roll job means that the employee is on a company’s payroll from the moment they join the organisation as a full-time worker. They receive a fixed payment for their services credited to their salary account. This number is determined after negotiating with the employee and according to the company’s regulations. On-roll employees also enjoy benefits such as allowances, performance bonuses, and health insurance for themselves and their families.

On-roll jobs are a staple of the job market as they provide opportunities for career growth and salary increases, thus creating a sense of progression for the employees. They also provide security through regular, steady pay and other benefits. In on-roll positions, employees must fill their taxes and contribute to a provident fund that the company manages to provide a secure future to the employees when they retire.

In an on-roll job, an employee can enjoy taking a specific number of paid leaves as per their offer letter. Also, the employee has to serve a notice period before leaving the position. Likewise, the company will provide the employee some time before the event of a lay-off or firing. So, an on-roll job is a highly secure form of employment.

Off-Roll Jobs

The recent rise of the gig economy has seen an upward trend in off-roll jobs with the increasing number of freelancers and consultants. In off-roll positions, the consultant is hired to work for a company without being on their official payroll. A contractor might even employ them to work for a third party. While off-roll employees can negotiate their hourly rates or even assignment-based remuneration, they do not receive benefits like allowances or insurance. An off-roll employee is paid for their services and does not enjoy any paid leaves.

An off-roll employee is not tied down to a company and can resign without serving a notice period. Likewise, the employer can also terminate their services without any intimation. Thus, off-role jobs offer no job security.

How To Decide Whether To Hire For On-Roll Or Off-Roll Jobs?

With both on-roll and off-roll positions offering a different employee-employer relationship, it is essential to know about your company’s employment needs. You need to consider your operating budget and whether it can be adjusted to accommodate on-roll employees, as their recruitment and onboarding process can strain your resources compared to off-roll employees. Also, it is vital to ascertain whether you are hiring to take care of temporary work or looking for a long-term hire. Hiring on-roll employees means you have to pay at least the minimum wage and provide other benefits while also paying the payroll tax. Working out the cost for one employee can help determine whether you have the budget for on-roll employees. If not, there is always the option to hire for off-roll jobs.

Pros of on-roll employees

Before hiring an on-roll employee, you need to estimate the return on investment for that hire. By calculating the amount of revenue you can generate with the help of the hours put in by the full-time employee, you will be able to estimate whether paying the salary of a full-time hire is financially advantageous to your company.

On-roll employment is the more popular form of recruitment because it has many visible advantages.

1. Employee loyalty

On-roll employees are highly loyal to the company because they work full-time. So, no conflict of interest comes with working for other clients simultaneously. Also, as on-roll employees tend to stay with a company for a long time for a sense of stability, you can count on their loyalty during testing times full of workplace challenges.

2. Higher productivity rate

Full-time employees are part of a highly competitive yet cooperative workplace environment. A full-time employee is motivated to excel and outperform their peers to gain performance bonuses and secure career progression at a steady rate. Thus, you can ensure that your full-time employees give maximum effort when performing their duties.

3. Workload consistency

As on-roll employees work consistently in your company for a long time, you can be reasonably certain of their work output while making estimations and projections. This helps managers to maintain workload consistency across levels and reduce the possibility of employees working overtime. This way, on-roll employees can positively contribute to workplace morale.

4. A trained workforce is familiar with your company

While training on-roll employees can strain your resources and be time-consuming, it often yields great dividends in the company’s day-to-day operations. On-roll employees are well-versed in the ins and outs of the company and the work processes. So, with their training and know-how, on-roll employees constitute a trained workforce that can efficiently operate while negotiating the workplace’s daily challenges.

These multifaceted advantages of on-roll employees make for an excellent case for making full-time hires. However, hiring full-time employees may not always be the right move.

Cons of on-roll employees

While on-roll employees are generally a rewarding investment, they still carry certain disadvantages that need to be considered.

1. Additional costs

The costs of maintaining on-roll employees can be pretty expensive. As their employer, you will need to provide benefits like paid holidays and health insurance, which can add to significant costs over time.

2. Greater training requirements

Since full-time employees are a long-term investment, you will need to invest considerable resources to provide them with training and onboarding. While this investment often pays off in the long run, it is still an additional expense that can be a burden if you are financially strained.

  Thus, hiring an on-roll employee can be quite advantageous as long as one considers the potential financial strains of a full-time hire.

Pros of off-roll employees

Hiring off-roll employees can be a viable alternative when a full-time hire does not make financial sense.

1. Flexibility

Hiring off-roll employees is a highly flexible process that allows you to recruit new staff quickly without the protracted process of hiring a full-time employee. Also, the temporary nature of employment will help you protect your existing staff’s positions while allowing you to bring off-roll employees during peak and challenging times.

2. Reduced costs

Off-roll employees can save you a lot of resources you would spend on providing allowances, insurance and paid leaves to a full-time hire while still providing a professional output level.

3. Experience

Many successful off-roll employees are freelancers and consultants with a vivid and varied body of experience. So, you can easily hire off-role employees who possess the skills you seek without the risk of hiring a full-time employee who will have to be trained to perform the same role.

Off-roll employees can thus be a valuable addition to any company.

Cons of off-roll employees

While off-roll employees provide great value in terms of cost and performance, they are not always the best fit for an organisation.

1. Lack of commitment

Off-roll employees can be quite professional and productive. However, they are not on your company’s payroll and work as independent professionals. So, they might have other commitments preventing them from prioritising your work like an on-roll employee might.

2. Security concerns

Off-roll employees often work remotely, so you must be wary of security concerns. Providing freelancers and consultants access to the company’s systems and documents carries an inherent risk. So, you will need to conduct regular checks to ensure your data’s safety.

Thus, off-roll employees offer lucrative benefits but also certain downsides that need to be addressed for smooth company operations.

In an increasingly remote work culture, both on-roll and off-roll jobs come with their unique sets of pros and cons. While on-roll recruitment still offers the traditional benefits, the gig economy has left businesses spoilt for choice with highly skilled off-roll consultants available for hire. So, it is up to you to consider your company’s recruitment needs and budget and then decide accordingly.

Post a Job

Ready to get started?

Post a Job

*Indeed provides this information as a courtesy to users of this site. Please note that we are not your recruiting or legal advisor, we are not responsible for the content of your job descriptions, and none of the information provided herein guarantees performance.