Secondment: An employers guide

For an employer aiming to broaden their workforce’s experience and skills, a secondment could offer the perfect solution. They gain the career development they want, and it can contribute towards your business growth in the long run. Before using a secondment, as an employer you need to consider all the aspects and factors involved. In this article, we will cover the factors that you should examine when making a decision on seconding an employee, as well as talking about the objectives and guidelines you will need to follow.

Talk to a member of our expert HR and Employment Law team today on 01455 858 132.

• What does secondment mean?
• Internal secondment
• External secondment
• Secondment agreement versus secondment contract
• How do secondment contracts differ to an agreement?
• Objectives and benefits of seconding an employee
• How does a secondment work?
• Learn from industries that regularly use it
• Ask a Croner expert for advice

When considering this as an option you will need to make decisions based on the following:

• Will it be an internal or an external arrangement?
• What kind of a contract will they need?
• How long will it last, who will pay the employee, and what happens if the other employer decides to keep the secondee?

What does secondment mean?

A secondment means a temporary assignment for an employee to a different part of the business, or a different company. It allows workers to develop skills either in a different area of their field, or in a new, related industry. Such an assignment can refer to one employee, or a group of employees.

There are two types of secondment employers can utilise to achieve the desired results for their employees, internal and external.

Internal secondment

In this instance, an employee could gain experience in a different department of the same company. This gives them the opportunity to support other areas of the organisation, whilst developing a new skillset. You might even consider them later for a change of position if another department is growing within your business.

When you place staff on an internal secondment, there are fewer legal risks. Therefore, the transfer can be more informal. Still, you might need to change minor details in their employment contract, such as their duties and hours of work. Remember that you cannot modify someone’s contract without their consent.

How does an internal secondment affect employee rights? The answer is that it doesn’t. Internal secondment employee rights are the same as the rights highlighted by their main terms of employment.

External secondment

For an external arrangement, we recommend that the two businesses sign a secondment agreement. This will cover the rights and obligations for all parties involved. A separate formal document will outline the changes to the secondee’s contract. The secondee has a contractual obligation to return to their original employer.

Secondment agreement versus secondment contract

For an effective secondment, both businesses entering it should sign a document stating the main terms. 

The business seconding the worker remains their employer. They do not transfer any employment obligations to the other business. The host will take over day-to-day management of the employee for the duration of the secondment.

Keeping the above in mind, a secondment agreement needs to specify:

• The duration: It could be a fixed term agreement, or a flexible one.
• The secondment role: As the seconder remains the worker’s employer, the host cannot ask them to do anything that’s not outlined here.
• The pay: Usually, the original employer will continue to pay their seconded staff. However, if the employee brings significant commercial benefits to the other company, the host could potentially repay the seconder. Some organisations cover this in an existing secondment pay policy.
• Extra expenses: The two companies entering the agreement need to decide who will pay for overtime, any bonuses, and business travel costs.
• Ending the arrangement: The agreement will specify if it refers to a fixed term secondment, with or without notice. As a third option, it could end at any point with notice.
• Confidentiality clause: This will protect both businesses, as the secondee may access sensitive, confidential data with both companies.
• Restrictive covenant: Such a clause will reduce the risk of unfair competition, as well as protect the employer from losing their worker to the host business.

How do secondment contracts differ to an agreement?

A secondment contract outlines changes to the existing terms of employment for the worker. It stands as a legally binding document. A secondment agreement outlines the practical and temporary terms and allows for a smooth transition back to the employees original role.

Objectives and benefits of seconding an employee

Having highlighted what employees gain from such an arrangement. It is time to explore in more detail at how it will benefit an employer’s business as well as their wider workforce:

• Enhances the professional growth of the employee: The skills and knowledge they improve will become a long-term asset for their employer.
• Offers a career development opportunity: This can be especially useful when a new role within the company cannot be created. This can reduce the risk of staff leaving the company.
• The employee can be a temporary replacement: The employee can cover a colleague on long sickness or maternity leave, so the company avoids hiring a new person.
• The secondee can support another department: An excellent option during busy, demanding times.
• The arrangement improves partnerships between two companies: This can encourage further collaboration between businesses.
• Host gains new insights and perspective on business development and growth: This allows employers to find new possible solutions and investment paths, by looking at things through a different lens.

As we can see, the objectives and benefits of such an arrangement tend to overlap for the secondee, the seconder, and the host.

How does a secondment work?

You should now have a fair idea about what such an agreement means and what it involves. We have also discussed what you need to cover in terms of contracts and documentation.

If you have never seconded an employee, you might wonder how it works. Let’s look at the whole secondment process in steps:

1. Identify the objectives and the business interests that the arrangement will serve.
2. Identify the partner company and the role they can offer. It’s recommended that you already know them and have some business ties with them.
3. Identify the worker(s) for the secondment if you haven’t already done so. If you are looking to offer opportunities to a certain employee, this will jump to the first step in the process.
4. Discuss and decide all the important aspects of the secondment agreement, as highlighted above. This will turn out to be the lengthiest of the preparatory steps. It will include all parts involved.
5. Introduce your employee to the host and their new colleagues before they start working with them. This will reduce unnecessary additional stress and concerns.
6. Establish how you manage and support the secondee during the process. Remember that they are still your employee and continue to be your responsibility as an employer.
7. Prepare their return to working within your business ahead of time. The last thing you want is for them to feel they no longer fit in and leave their employment with you when the arrangement ends.

Be prepared to deal with the unexpected too. Should the circumstances of the host or the secondee change, you could consider ending a secondment early.

Learn from industries that regularly use it 

It is easy to see why the academic sector uses secondments on a regular basis. Such arrangements allow universities to second staff for both teaching and researching purposes. But academia isn’t the only field where organisations benefit from similar agreements.

Engineering research and collaboration also proves to be fertile ground for them. 

Most universities use at least an internal secondment policy. You will also find inspiration in examples of how they word an international secondment agreement and policy. In this case, further considerations need to be made around international law and working abroad.

Ask a Croner expert for advice

If you think your business will benefit from seconding employees, talk to an expert member of the Croner HR and Employment Law advisory team. We will advise you on writing a secondment agreement, and a secondment policy in accordance with the UK law. 

You might have never considered before how an arrangement like this can improve staff retention and boost their career.

Call us today to discuss your options, on 01455 858 132.