sharing employees

mikep

We are a manufacturing facility that produces a similar product as another manufacturing facility in the area. We do not compete with each other at all. One differnce with our companies is that we have "peak periods" throughout the year and the other company remains for the most part constant all year. But, neither company lays off employees during the slow times. Another difference is that we operate on three shifts and they utilize 1 1/2 to 2 shifts.

For the most part, we are able to use temporary staffing to support our busy periods. But, we have some skilled positions that just cannot be filled by temporary labor. So, all we can do is increase their hours during the busy times, but that is sometimes not enough.

So, I thought it would be a good idea to approach this other company with the idea of "sharing" our skilled employees with each other. When we are busy, their employees can come work for us on their off days/hours. When we are slow, our employees can go help them to cover vacations, etc. (if they want us to).

I think that basically explains what I'm wanting to do. I haven't even approached the other company yet as I have too many logistical questions in my head. My question to you all is how can we do this? There must be some legal ramifcations to sharing employees like this. Can we keep their employess as THEIR employees and our employees as OUR employees and just bill out the services to each other? Has anyone ever done something like this? Just looking for some advice...do it / don't do it. If we do it, how do we go about it?

Thanks!

Mike

mdm

Hi Mike-

I currently work for a company that shares certain employees (mostly IT) with another company. It has worked out well so far. We bill the other company for the use of our staff and they bill us for use of their staff. The heads of both companies are acquaintances and one brought it up to the other. Upper management for both companies were for the idea. We had a management agreement drawn up by a lawyer for both companies to sign. It hasn't really caused any negative issues for either company. We have been doing this for about 2 years now.

Brad Forrister

You've probably already thought of this, but if the other company runs full-tilt all year long, won't your use of their employees throw them into overtime? Whereas if you just hire them to work a second job, you're not incurring time and a half.

Brad Forrister
VP/Content
M. Lee Smith Publishers

pork1

MIKE: I have done that but only in a very specialized and credentialed professional arena called AVIATION. Our company had three air planes and three pilots, but two of the aircraft required two pilots aboard to fly passengers. We pooled our aircraft and pilots of three companies in order to use the aircraft. We decided the cost of flying an aircraft which included the pilots salaries. We the major company, then billed out the operating hours and expenses to the other companies. Each paid their own pilots based on salary and flying hours as pilot and co-pilot. We also had one contract pilot in the mix. It was an administrative night mare, but we made it work. It takes some real work to figure it all out but it can be done with EXEMPT employees. We did not fool with labor employees and I wouldnot want to try.

PORK

Leslie

My HR oversees the employees of six different enterprises owned by the same people. All different tax IDs. However, we had have folks working full time for the casino, say as a cashier in the cage, and then have a second job across the street as a cashier at our convenience store. IRS said nope, those people get OT, so we had to make them stop.

I don't see that in this case - the two manufacturing facilities aren't related. Wouldn't it behoove you to just offer some of the folks a second job?

mikep

Thanks for all the replies so far! I know the "second job" idea seems the most logical way to go. But, I think that would be defeating one of our purposes in that we need to keep our permanent head count to a minimum. This is why we utilize temporary staffing. I also thought it would be politically smart to propose this idea to the other company as a partner, if you will.

But, based on some of your replies/suggestions I think I might do a little of both. I'll talk to the other company about the idea of their employees getting a "second job" with our temp agency as the employer. Then, I can request those specific people through the temp agency on an as-needed basis. And, I'll suggest the same of the other company with our employees.

Thanks, again!

Mike

SandiF

Couldn't you just have the employees work on a fill-in basis for the other company? Then you wouldn't have to pay extra for the employment agency. You mentioned keeping head count to a minimum, so I may be missing something.