Contingent workforce management involves sourcing, engaging, and managing a variety of talent—think independent contractors, consultants, freelancers, entrepreneurs, digital nomads, gig workers, and more. Building a successful, blended workforce that combines both contingent and full-time talent requires careful planning and strategy. Here’s what to keep in mind:
- Engage talent quickly, cost-effectively, and in compliance,
- Design and scale a contingent workforce program, and
- Take steps to optimize that workforce
7 Benefits of Creating a Contingent Workforce Management Program
When engaging any type of contingent talent, companies should take steps to comply with relevant laws, policies, and regulations. If a company fails to properly classify and manage their workers, they may be violating wage, tax, and employment eligibility laws. That’s why a contingent workforce management solution is the best way to minimize exposure to misclassification liability.
When designing your program, keep in mind that, generally speaking, compliance requirements should increase as the dollar value and duration of an independent contractor’s engagement grow. For example, professional service contracts that average six months and thousands of dollars require a greater level of compliance than a commodity, app-based service.
Skilled independent talent comes from a wide range of backgrounds, each bringing their own level of self-employability. With the right program in place, companies can provide these professionals with the flexibility they are looking for in a client relationship while ensuring their own compliance.
Taking the time to build a program to manage your contingent workforce comes with many benefits. For example:
- Increased control over compliance risk: A contingent workforce program helps organizations manage insurance requirements and tax payments, minimize rogue enterprise managers, control worker classification, and stay on top of the changing regulatory climate.
- Significant cost savings: This type of program can also help to eliminate the financial burden of worker misclassification while providing companies with the insight and data they need to efficiently manage independent contractor spend. It gives companies the ability to bypass the expense of recruiting, hiring, and training full-time employees for similar initiatives.
- Increased productivity and efficiency: Having this program often enhances contingent worker satisfaction and has led many organizations to see increased output, greater satisfaction, and higher productivity levels among their talent.
- Staffing flexibility: Independent talent give companies the ability to bring skilled experts on board when and where they are needed most, allowing them to grow and shrink their workforce throughout the year.
- Competitiveness and innovation: Bringing in talent with in-demand skills lets companies to be more agile and competitive among their peers, giving them ability to innovate in new areas outside the expertise of their core workforce.
- Empowered enterprise managers: A contingent workforce program with simplified onboarding and engagement reduces the amount of time managers have to spend reviewing candidates, creating an easy-to-follow process.
- Future re-engagement: Previously engaged independent talent can quickly and easily be re-engaged for future projects, cutting down on onboarding time, saving costs, and getting projects up and running faster.
How Contingent Workforce Management Leads to Workforce Optimization
A contingent workforce management solution doesn’t just solve the immediate tactical issues of engaging independent talent—it can lead to total workforce optimization. Businesses today know they need to think differently—and a flexible workforce allows companies to quickly respond to project demands, more easily meet budget constraints, and remain open to innovation. In our ever-changing economy, properly managing independent talent resources can create true competitive advantage.
Looking for more information on building your own contingent workforce management program? Contact our team of experts today.
The information provided in the MBO Blog does not constitute legal, tax, or financial advice. It does not take into account your particular circumstances, objectives, legal and financial situation or needs. Before acting on any information in the MBO Blog you should consider the appropriateness of the information for your situation in consultation with a professional advisor of your choosing.
