In 2019, LGC made a decision that changed the way we approach our staffing model forever. Now, 5 years later, we are gearing up for another monumental shift with the launch of our newest staffing technology, StaffNow.
With the advent of staffing apps over a decade ago, companies were able to add an “on-demand” component to their strategy. Job boards shifting to a one-click model showed an exponential increase in their placement efficiency, as well as their overall reach.
While there are obvious benefits to partnering with a company that uses staffing apps, there are 2 glaring issues you must be aware of before you sign any papers. LGC’s co-founder Glen Greenawalt provides his insight on these issues below.
Being an app vs. Having an app
The best staffing apps are run by companies that uphold their relationship with clients and candidates. Companies that rely solely on their technology to automate all of their staffing efforts will fall victim to “being an app.” If you allow an app to replace the work that real people do, then you will lose the human touch of a client relationship that technology is not equipped to provide.
This is not a new idea. Glen explains a similar phenomenon that mirrors what we are seeing now with app companies:
Glen: “During the 1999-2000 “dot-com” mania, everybody was on board with the idea that the Internet would change everything. In the staffing business, there was a rush to websites. The word on the street was that the Internet would put headhunters and staffing companies out of business. Some staffing companies who believed this, became fully web-based entities and worked to build machines that would be wholesale clearing houses for candidates and clients to meet.”
Glen: “This never materialized, and the firms who shifted their focus either went out of business, or became mere shells of what they were before. Did the Internet fundamentally change everything over time? Yes, just not in the way everyone thought, and it did not destroy the need for temporary and direct-hire recruitment. We believe that this time is no different.”
When creating StaffNow, we kept our client/candidate mission at the forefront of our priorities. Implementing app technology into our processes is a way to enhance our work, not replace it. In Glen’s words:
Glen: “LGC uses technology as an accelerator. It will not replace the engine, which is our local branches with staff in them: it will supercharge them. Our app will improve response time in all situations, but our quality will be driven by spot checking placements and making manual adjustments.”
This is the difference between LGC’s StaffNow and other app-based companies. We have an app, but we aren’t actually in the app business. You can see us, call us, and better yet, we’ll be at your events occasionally to manually double check our work. Just because part of our services have shifted to a screen doesn’t mean the heart of our work disappears. This is our promise.
Employment Misclassifications
What is the appeal of turning to an app for staffing solutions?
Glen: “Many, but not all of these app-based ‘staffing companies’ have one real edge, and that is cheaper rates. They gain this edge, not by efficiency, but by misclassification of employees. They call W-2 employees ‘contractors’ and do not pay them overtime, withhold taxes, or offer insurance. This is at odds with both the law and the current push towards equity and fair wages.”
Back in March, LGC released an overview of the Department of Labor’s Final Ruling on independent contractor misclassification, outlining this exact issue. Gig employment on app platforms face this issue quite often, which has expensive ramifications for clients who partner with companies that do not classify their workers correctly.
Since our founding, LGC has been a W-2 industry leader. With the upcoming launch of StaffNow, this is not changing. All employees, internal and external, receive a W-2 tax document, and are protected under our workers compensation and insurance benefit packages. Companies that do not do this are putting themselves at a disadvantage.
What kind of consequences are we looking at? Glen explains:
Glen: “Local, state, and federal governments do not receive payroll taxes, and have these companies in their crosshairs. Their employees, who are in line to receive back pay/benefits, and who largely feel unheard in these environments, are now partnering with law firms who also have these companies in their crosshairs.
Glen: Unbeknownst to their clients is this fact: they are co-employers of the temporary help, and when the app company goes under, they will be on the hook to pay the back wages and benefits. Hospitality companies who utilize these ‘app’ companies will not be shielded by their relationship with the app companies. They may pay their bills now, and they may also be paying back wages, benefits, fines and taxes later. LGC’s biggest and best clients are aware of this and are not falling into this trap.”
As clients of these companies, you deserve to know where you’re investing your resources so that you can trust the hands that hold them. At LGC, we are proud to have been doing right by our clientele since 2003. Take it from us, using an app to find staff shouldn’t feel like a slippery slope or a turn to the dark side.
With the upcoming release of StaffNow on July 1st, we offer both a personal approach and correct employment classifications. This is so that as a client, you will not only feel supported by real people, but you can take comfort in the fact that we have taken action against real issues. StaffNow is supported by cutting edge management software that allows you to keep tabs on your staffing orders, and receive real-time updates. We’re so excited to launch this technology and for you to get your hands on it! Contact us today to get connected and enjoy the full benefits!
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About LGC
Since 2003 LGC has been building connections between businesses with staffing needs and job seekers looking for new opportunities. Our range of solutions includes temporary and permanent placements (and everything in between) for a variety of industries. With offices located nationwide, we can tap into a dynamic pool of talented professionals. We have a passion for creating partnerships that last and work hard every day to ensure both clients and candidates reach their employment goals.