Why would I leave my W2 job for your contract to hire position? All I can see here is a company that doesn’t want to fire people who aren’t working out, possibly to save on benefits and unemployment insurance premiums. And why do you have so many people not working out that you have to do this? None of this inspires any confidence.
Yeah, in my experience asking the basic question of why I would even entertain moving from my W2 job to a contract position where I assume 100% of the risk is met with dead air on the other end, followed by a hasty assurance that we don't really have to go the contract route.
It gives me the feeling that I will be working with people who either don't know their own value and so are willing to agree to this kind of deal, or are so poor performing they don't have the leverage to insist on a regular employment contract.