The modern workforce has never looked more different than it does today. Many people work remotely or in community workspaces, businesses now offer flexible work hours, and the boom of the gig-economy has made keeping a side job easier than ever. With all these new changes new many companies have to learn how to manage their contingent workers
According to Deloitte’s 2018 Global Human Capital Trends, more than 40% of workers in the United States are now employed in “alternative work arrangements,” such as contingent, part-time, freelance, or gig work. This isn’t just a trend either. Contingent workers have increased by nearly 36% in the past five years alone.
The sheer variety of today’s work makes it hard to even understand what types of workers are employed, let alone manage them strategically. As alternative work becomes our new normal, business leaders must start to rethink how they are willing to support and manage this wide range of generations and skill levels.
The biggest benefit of contingent workers is financial– because they’re not official employees, you don’t have to worry about paying benefits, vacation pay, and overtime. Your business only pays at the rate of work or a fixed price per project. Contingent workers give you the perks of an official employee without the piles of paperwork.
Contingent workers also provide valuable expertise as they can be a wide range of age and skill levels. In Deloitte’s same survey, 50% of the year’s respondents reported a significant number of contractors in their workforces; 23% reported a significant number of freelancers, and 13% reported a significant number of gig workers. When you opt for someone in the contingent workforce, the job gets done by a seasoned pro.
Another major benefit of a contingent workforce is flexibility. Temporary workers are there to suit your needs, whether you want help with a one-time project or need them to stick around for a few months. Once the terms you’ve agreed to are up, your professional obligation to this person is over. You can choose to work with them again–or you can end your business relationship right then and there. It’s up to you (and to them) if you’ll use their services in the future.
What is the downside of hiring this type of work? Though this emerging new trend in workers has many upsides, it also brings a variety of new challenges for businesses and their current employees. Only 16% of businesses surveyed said they have established a set of security policies and practices to manage this variety of worker types, pointing to an enormous gap.
Keep control in mind, too. Sure, you’re paying this person, but they’re not a formal employee. You determine what they do, but you don’t necessarily have control in how they do it. Contingent workers can’t be supervised the way employees can. When you rely on a contingent workforce to help your organization, you lose a certain degree of authority creating legal, security, privacy, and other risks.
Contingent workers may not have a way to properly identify themselves at all times as normal, salaried employees. They also may not keep normal schedules, so they are coming and going at various times on different days. And most HR software on the market today is not built to manage “non-traditional” workers and in most cases, they build their own tools and apps to manage their most-utilized contingent workers. Unfortunately, this does not cover all the bases and leaves room for potential risks.
Before you bring in an outside worker, be sure to familiarize yourself with the different employment types to avoid any legal dilemmas and take the necessary precautions to ensure hiring compliance is in order. Draft a contract that provides a clear, accurate job description, note their exemption status, and outline a pay rate and a time frame.
Well-known businesses like Fiverr, Upwork, and Doordash have learned to manage their contingent and gig workers by exploring different ways to improve lives. In 2018, a coalition led by Fiverr, Care.com, DoorDash, Etsy, Postmates, and others, working with Stride Health, launched an initiative to help freelancers access health care programs and insurance in the United States.
Another great way to manage your contingent workers is with security technology like FedCheck. By instantly screening your contingent workers, visitors, and vendors, their identification is stored with your security team making it easier to know exactly who is coming and going from your facility. By scanning their ID with each visit, you avoid the outdated method of identification like printing badges, sign in devices, and bag checks.
Best of all, you can see in real-time when and where they arrived and make detailed notes to minimize potential risks like loss of confidential information, theft, violence, and more. The more detailed you can be, the better.
As freelancers, gig, and contract workers become a growing part of the workforce, developing and integrating workforce strategies to manage both full-time employees and contingent workers can help an organization take advantage of the breadth of workforce options available today.
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