Managing a Contingent Workforce

03/19/2019

With a steady rise in contingent work arrangements in the US and elsewhere, employers have started to realize the value of hiring independent contractual workers. The appeal of specialized skills, along with low hiring costs and flexibility, has made contingent workers a preferred option for many leading companies.

But the rise in the number of contractual workers has also led to a pertinent question. Are contingent workers manageable? While there are many benefits of hiring them, it's also important to be aware of how to manage them. That aside, there are a number of issues to consider while populating your organization with contingent workers.

Here are some points to keep in mind when managing contingent labor:

Staffing firms

The decision to hire contingent labor is best left to a staffing firm. They can screen, select, recruit, and assign workers to your organization. Never get directly involved in the hiring process. Let your staffing supplier determine the wages and benefits to be paid to contractors. Your firm can negotiate the bill rates to be paid. Even though contractual workers are separate from your regular employees, it?s a good idea to involve them in business and social events. Let the staffing agency handle invitations. It helps to maintain the highest level of professionalism and at the same time, keep things running smoothly.

Distinguish your contingent employees

Well, this is where things can get a bit tricky. Successful management of contingent workers means that you have to acknowledge them as non-permanent employees. They are self-employed employees working on contracts and are not always subject to all benefits. This issue should not be taken lightly. It could lead to legal issues if ignored. Contingent workers are not on the company?s payroll though they have to be paid every month, or according to the terms of the contract. You have to maintain a separate payment process for your contingent workforce. Each contingent worker would have a different rate of payment. The payment schedule is also different. Employers can try to bring all contingent workers under a common payment schedule to make the work easier.

Data management system

A data management system (DMS) is an effective tool to manage contingent employees. This could be an integrated vendor management system (VMS) or a standalone program. An integrated VMS ensures that payments to all contingent workers are prompt and free from compliance violations. A VMS is an automated software program to manage suppliers, contractual labors, and temporary workers. These are often cloud-based systems that help with deliverables, carry out analytics, and have forecasting features. A VMS is a great tool that allows companies to track and evaluate performances of all employees.