Best practice for external (Guest users) that are already in AD/AAD

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We have external users that are already in our on-prem AD/Azure AD that are not my company's employees, but need access to internal resources to assist with projects (contractors, vendors, etc).  The only way they can access Teams currently is to provide them a MS license.  We would only like to license our actual staff and not every vendor, and use the Guest access as it is intended.  What is the best practice to give these users access?  Full E3 or F1 license, delete/re-add users, force to use different login credentials?

 

Will the Federation with Google help with this in the future?

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