How you describe the CTH process is exactly why I think that it is bad. It is used to attempt to remove all risk from the company and is based solely on the belief that employees have no other options and will tolerate being abused because what else can they do. This is why CTH only gets the workers that other companies weren’t willing to hire. It is quite rare that a serious professional will even speak to companies listing CTH as their plan. Companies doing CTH don’t necessarily realize this as the best people don’t even apply for their jobs.

And even many of the things you recommend, like firm intents to hire with certain notification periods, that is fine, but both companies and individuals remain at will for work. Just because intent isn’t given, a company can always decide to make an offer. An employee can always decide that they’ve demonstrated better value than expected and demand more money. Or find a better offer elsewhere and leave prematurely or simply not accept the employment offer.

It is not bad faith for a potential employee to demand renegotiation of employment that has not yet been offered. You may desire not to hire them out of bitterness for having chosen poorly by using CTH to opening yourself up to them not accepting, rather than quitting, when you can’t pay them at their expectation, but it is not bad faith any more than attempting to pay them based on rates negotiated during an “unknown” state when the actual employment will now happen in a “known” one.

CTH is, at its heart, a poor attempt to take advantage of employees who don’t understand the system or may have little alternative. It isn’t a good tool for companies seeking the best people. And there are more honest ways to hire people who aren’t easily able to be hired elsewhere.

Next, define compensation both during and following the contract period up-front and be firm. If there is any push-back or “leverage” attempted when it comes time to hire, that’s not the type of person I want working for me anyway and they get launched based on acceptance up front and acting in bad faith later. Trust is earned and that is anything but…

Last, a firm 60-day notification as to hire intent. Employer notifies contractor that they intend to hire on the date at end of contract term with compensation already defined. No mystery or negotiation and if the contractor balks or disagrees in any way, the employer has at least some time to find a replacement instead of being under the gun at the end of the term when an offer is presented and rejected.

As with anything, think ahead, deal openly and honestly with people throughout the term (be the “adult” and get rid of childish people that tend to stomp their feet and expect to get their way), absolutely stand firm on defined terms, and it will become very clear whether they should be a part of your organization.

CTH is a viable option in the right situation, as long as it’s managed well. If you make it about skills and money, huge mistake… evaluate the person, not the resume and the path to the eventual hire gets much easier. How many idiots do you know working for companies that tolerate them? It’s no accident… it was allowed, or even encouraged, every step of the way.

So true. I’m in the school that would NEVER apply to a contract to hire position. I’m sure most of us have also hears stories of Contractors taking the jobs and when offered a full time position, demand a stiff Salary increase using the leverage they have being trained and on board. Just a terrible idea altogether.