A Guide to HR Contracts

Improved Training & Development

Tendering for HR Contracts

Tendering for HR contracts provides opportunities for HR businesses of all shapes and sizes to add to their revenue streams. The process (especially in the Public Sector) is a fair, unbiased approach for the procuring and sourcing of work, goods or services. Prospective suppliers must ‘bid’ for this work, most notably through the submission of an SQ and ITT. You can find further information on the ins and outs of tendering on our sister website, Tender VLE.

Stages of Tendering

Selection Questionnaire (SQ)

Also known as a Pre-Qualification Questionnaire (PQQ), the SQ typically acts as the first stage in the tendering process. Enabling buyers to sieve through prospective suppliers and decide which organizations have the capacity to deliver upon the requirements of the tender documents. SQ’s allow your business to demonstrate their compliance with the relevant legislation. You can provide previous examples of similar contracts that you have delivered. The SQ is similar to an application form. It will not win you the work outright, but a successful submission will certainly propel you to the next stage.

Invitation to Tender (ITT)

ITT’s provide suppliers with the opportunity to submit a much more detailed, all-encompassing response to the set requirements. ITT’s can be released alongside SQs, or withheld until after the prospective supplier passes the SQ stage. In response to an ITT, suppliers must provide answers to a range of quality questions. This is to demonstrate their technical capacity to deliver the contract. In addition to this, they must almost always have to submit a pricing schedule. Suppliers must price the work involved in the contract, as per the buyer’s guidance.

Winning ITT submissions will prove to be the most economically advantageous tender for that buyer. This is based upon a combined assessment of their technical capacity and pricing. Typically, HR contracts weigh heavily toward favoring technical capacity. Meaning ITT responses in this sector are typically weighted 60/70% toward quality, with the remaining 40/30% determined by the pricing.

Types of HR Tenders

HR contracts cover a broad range of services such as:

National and international recruitment, Employee training programs, and performance management, to name a few.

The need for these services only continues to grow, as more and more HR functions are outsourced to specialists. If you are looking to secure HR contracts through the UK procurement system, there are numerous types of tenders to bid for:

Framework Agreements

For many Human Resource providers, framework agreements are the primary inroad to procurement opportunities. Frameworks can vary in size, expanding from regional to national and potentially international scopes. Once admitted onto a framework agreement as an ‘approved supplier’ you will be able to bid on ‘mini-competitions’ for work. Work available on the framework is entirely restricted to those selected ‘approved suppliers’. Status as an ‘approved supplier’ typically lasts four years but can vary dependent on the individual agreement.

In terms of HR contracts, framework agreements can typically be seen in the outsourcing of recruitment. For instance, the Health Trust Europe consortium manages framework agreements for national and international permanent recruitment of healthcare professionals within the NHS. ‘Approved suppliers’ services are solicited as and when needed to provide both national and international recruitment solutions to various functions and locations within the NHS.

Dynamic Purchasing System (DPS)

DPS’s, similar to framework agreements, allow ‘approved suppliers’ to bid for work that is closed to the wider tendering world. However, unlike framework agreements, DPS’s do not have a shut-off point and can be applied to at any time whilst open.

– John Hudson (M.A, F.R.S.A)