Staff augmentation is a strategic outsourcing approach where organizations bring in external professionals to support their existing teams for specific projects or temporary needs—without committing to long-term employment. This model enables businesses to scale quickly, access specialized expertise, and adapt to changing workloads efficiently, all while keeping control over project execution.
When a company that receives a SOC 1 or SOC 2 report uses staff augmentation, it’s important to evaluate whether the augmented personnel should be classified as a subservice organization. In most cases, staff augmentation does not qualify as a subservice organization for SOC reporting. The main reason is that a subservice organization is one on which the service organization relies for specific controls to meet its service commitments to clients.
In contrast, under staff augmentation, the client organization retains direct control and oversight of the augmented staff’s activities. The client remains responsible for the work performed, including the design and operation of related controls.
| Aspect | Staff Augmentation | Subservice Organization |
|---|---|---|
| Control | The client maintains full control over the work, including supervision, direction, and evaluation of the augmented staff. | The service organization depends on the subservice provider’s own controls and procedures to perform defined functions. |
| Integration | Augmented personnel are embedded within the client’s existing teams and processes to enhance internal capabilities. | The vendor operates independently, managing specific outsourced functions with limited client oversight. |
| Responsibility | The client is responsible for the quality of work and the effectiveness of related internal controls. | The subservice provider is accountable for its own controls tied to the services it delivers. |
| SOC Impact | The client’s SOC report covers controls related to the augmented staff since the client maintains direct responsibility. The report may note the use of external personnel. | The service organization’s SOC report must address subservice use—either by including the subservice’s controls (inclusive method) or excluding them and relying on the subservice’s own SOC report (carve-out method). |
SOC Audit Implications
Even though staff augmentation is not a subservice arrangement, it still requires consideration during a SOC audit. The “Description of the System” section of the SOC report should explain how the augmented personnel are managed, monitored, and controlled.
Auditors will review whether internal controls over the augmented staff—such as background checks, access management, training, and supervision—are appropriately designed and effectively operating. Proper documentation and oversight help demonstrate that these external professionals are held to the same standards as internal employees.
Conclusion
While staff augmentation offers flexibility and rapid access to expertise, it introduces specific compliance and control considerations in SOC reporting. Organizations should ensure that governance practices for augmented staff are clearly defined, well-documented, and aligned with their existing control framework.
By maintaining strong oversight and incorporating these details into the SOC report, businesses can confidently leverage staff augmentation without compromising compliance integrity or audit readiness.