How Much Does a Labour Hire Agency Cost in New Zealand?

Have you ever considered hiring workers through a labour hire agency? In a rapidly evolving world, using a labour hire recruiter to source temporary workers is a great way for organisations the stay flexible and adapt to fluctuating market conditions and business needs. However, one of the key issues that can deter people from engaging a labour hire agency is the perceived expense.

Google the best labour hire companies in Auckland, Wellington or Christchurch, and you’ll likely see a long list of agencies appear in your search results, each with a different pricing structure. Not only can this be confusing, but it can also leave employers wondering why it is better to use a labour hire service to fill temporary blue-collar roles than to recruit in-house. What exactly are you paying for?

To help you determine the best option for your business, we break down the cost of using a labour hire agency in New Zealand and explain key benefits of labour hire solutions for your temporary staffing needs.

The Cost of Using a Labour Hire Recruitment Agency

To understand the cost of using a labour hire recruitment agency, you must first understand how they structure their pricing. There is a common misconception among businesses that labour hire companies charge an exorbitant price for their services but in reality, they only charge a bit extra for taking over the burden of the recruitment process, alleviating the stress and hassle for you while guaranteeing you the best workers available. 

Generally, the overall price of labour hire is broken down into three key areas: Employee wages (tax-inclusive), on-costs (e.g. annual leave, sick leave, public holidays, ACC levies, KiwiSaver) and the recruitment agency’s margin for providing the services and payrolling the candidate. 

The best labour hire companies will never rip you off with their margins – this charge is kept fair to maintain affordable labour hire standards while ensuring the agency doesn’t have to compromise in the quality of screening/vetting services to secure the highest quality talent to meet your needs, and to then to manage them throughout the assignment.

Keep in mind that cheap labour hire often won’t provide the best outcomes for your business, as it will likely mean sacrificing on either the quality of the workers or screening/management processes, or both to keep the costs down. If you want skilled, hardworking and reliable staff for your business, it’s worth investing in a recruitment partner with a reputation for excellence in your industry. Given the majority of the hourly charge is made up of the pay rate set by you and the associated direct labour costs that as an employer you have anyway, you would generally be up for the same cost if employing directly as well, and can always check to ensure the cost is not out of hand. 

What are the Advantages of Labour Hire vs. In-House Recruitment?

If you decide to use a labour hire recruitment company to fill a temporary talent gap in your business, what are paying for, and what are the advantages of labour hire vs in-house recruitment? A good New Zealand labour agency’s margins will cover a range of valuable services and provide you with many benefits, including:

1. Labour hire agencies provide greater flexibility

Big contracts can be awarded at short notice, disruptions can impact deadlines and the scope of a project can shift suddenly. In such scenarios, you will need to have sufficient staff to meet contractual obligations and ensure work is completed on time. Likewise, a slower period could result in a surplus of workers and unnecessary overheads.

Regardless of your company’s size, using a labour hire agency allows you to quickly scale your workforce up or down based on your requirements and the market conditions, giving you the flexibility to expand when you need to, while accommodating short-term requirements by supplying workers only while you need them.

2. You can save time and stress by using a labour hire company

From creating the job ad, sorting through hundreds of CVs and interviewing candidates to contacting references, checking qualifications and onboarding hires, recruiting internally can be a burdensome and time-consuming process, particularly when there is an immediate staffing need to keep a project phase on schedule.

The realities of hiring internally can be avoided by outsourcing the whole recruitment process to a labour hire company, allowing you to focus on more important parts of your business. This means you have access to high-quality labour solutions with none of the wasted time, energy, resources and capital. The best labour hire companies will also take care of onerous details such as payroll and inductions to make everything as easy as possible for their clients, and some (such as OneStaff), will even provide Health & Safety training and ensure all supplied personnel have the necessary PPE before they arrive onsite.

At OneStaff, we also follow up regularly after a candidate is placed to monitor and manage their performance and ensure the expectations of all parties are being met. It is very important that the employer of the staff (the agency) remains engaged throughout the assignment to manage their staff  - it is a part of what you are paying for, and any reputable agency will ensure they deliver this. 

3. You will have access to skilled and ready-to-work temporary employees

With labour hire, you can quickly find temporary workers with the right skills, experience, qualifications and licences to perform the job. When looking for skilled labour hire, particularly in the Construction, Engineering, Logistics, Transport and Manufacturing industries, all staff supplied by a good New Zealand labour hire company will have the following verified, and be able to supply you proof::

• The right and suitability to work and background screening (Police record, ACC history, references, Immigration status etc)
• Health and Safety training and inductions, and drug testing
• The relevant verified licences and qualifications (e.g. forklift licence, appropriate class of driver’s licence, site safe, ConstructSafe, Trade Cert, height safety etc)

A specialised and experienced labour hire recruitment agency will have an extensive database of pre-screened workers with verified qualifications, who are ready to start straight away. They will likely have assigned these workers to other placements in the past, giving them a solid understanding of their capabilities, reliability and personality. They will take the time to understanding the specific Individual needs of you and your team, as well as your business – and they will run checks to support safe working environments and placements. This means you can rest in the knowledge that your temporary employees are going to fit seamlessly into the team for however long you need them. 

Contact the New Zealand Labour Hire Specialists

At Onestaff, we pride ourselves on being upfront and transparent about our pricing, making it easier for you to understand the value you’re getting for when you use our labour hire services. Each year, we also produce the industry-leading “What’s My Rate?” report, which allows employers to gain an understanding of what different types of workers are paid in New Zealand as well as track the latest trends in the sector. To get access your free copy of the report, click the button below.

If want to know more about the cost of using a labour hire agency or are looking for a labour hire company to take care of your recruitment needs, contact your local OneStaff branch. We have an extensive database of quality workers covering all of New Zealand, through 16 branches including main centres Auckland, Hamilton, Tauranga, Palmerston North, Wellington, Christchurch, Dunedin and throughout other regions. Whatever your staffing needs, we can connect you with a temporary worker to help you out. Register your job vacancy to get started today.