Wondering what is a contingent workforce? First, let’s start by explaining that contingent workforce solutions are becoming increasingly popular as employers seek to diversify their talent pools and gain access to specialized, experienced talent. However, managing a contingent workforce can be complex, as it requires specific management skills and processes different from those used for traditional employees. Developing a deep understanding of contingent workforce management best practices is crucial to ensure that your gig workers are productive and successful.
It is important to clearly define the company processes for temporarily hiring and managing these types of independent contractors. Establishing clear terms and conditions in individual agreements with each worker is also essential. These documents should include information regarding wages, hours, benefits, and any other applicable policies or procedures.
What is a Contingent Workforce?
A contingent workforce includes employees hired to work on an as-needed or short-term basis. When effectively managed, contingent workers can bring a valuable range of skills and experience to the organization when needed the most.
Is there a difference between hiring a contingent worker vs. a contractor? Should you hire a contingent worker vs. a temporary worker? It is also important to note that many “contingent workers” often refer to themselves by other names, such as.
- Independent contractors
- Gig workers
- Part-time workers
- Temporary employees
Because no two job descriptions or contingent worker agreements will be the same, managing a staff of gig workers with varying backgrounds, specialties, and work requirements can be a challenge. Managers use unique contingent workforce solutions—including contingent workforce recruiting technology—to provide access to specialized talent without having to commit to their employment long-term.
Contingent Workforce Management Success Factors and Benefits
Companies can benefit from cost savings with flexible pay structures and by avoiding permanent employee salaries and benefits overheads. Freelance workers are also ideal for filling in gaps quickly when there is a sudden need for additional support staff or expertise that cannot be met through current in-house staffing resources. Other benefits of a contingent workforce model include:
- Enhanced flexibility – contingent workers allow employers to scale up and down quickly, as needed.
- Reduced liability – contingent solutions shift some risks onto the contingent worker and away from the company.
- Increased specialization – contingent solutions provide access to specialized talent and help companies maximize their workforce management efforts.
- Lower hiring costs – contingent solutions can help lower the administrative costs typically associated with the more traditional hiring process of recruiting and hiring permanent employees.
- Remote work capabilities – contingent solutions offer remote work capabilities, allowing employers to access talent from anywhere in the world. Companies can also save money on employee insurance and other benefits typically available only for permanent in-house staff.
- Contingent worker salary and expense tracking – specific contingent workforce solutions and technologies provide the ability to track worker progress and related expenses, allowing employers to monitor their budgets with just a click of a button.
By understanding these contingent worker processes and management success factors, companies benefit from a flexible and cost-efficient staffing model that maximizes their workforce performance, profitability, and efficiency. By clearly defining contingent workforce policies—as well as the contingent workforce manager job description—businesses maximize their overall workforce performance for ongoing success.
Variable Workforce Examples
Perhaps one of the most widely known examples of a contingent or variable workforce is Uber. Uber is an on-demand ride-sharing service that recruits independent drivers to provide transportation services. The contingent workforce model used by Uber allows the company to quickly scale up or down as needed, depending on driver availability.
Another example is Airbnb, which provides travelers with short-term lodging options from hosts that range from homeowners to hotel operators. Airbnb’s contingent workforce model allows them to offer visitors various lodging and pricing options on an as-needed basis.
5 Ideas for Effectively Managing a Contingent Workforce
Contingent workforce solutions are becoming increasingly popular for organizations seeking immediate access to specialized talent or expertise without the need to commit long-term. By understanding contingent workforce management success factors, businesses can create efficient and cost-effective staffing plans for ongoing success. Here are five ideas for how to instill contingent workforce management best practices.
- Create an effective onboarding program – When recruiting contingent workers, it is important to create an effective onboarding and training program tailored to each gig worker’s individual skills and needs.
- Communicate expectations clearly – Companies must ensure that all contingent workers understand their assigned roles, responsibilities, and expectations from the start. Clear communication helps avoid misunderstandings or miscommunications down the road.
- Establish a feedback loop – Feedback should be provided timely and regularly, so that contingent workers know how they perform in real-time. This strategy also allows for quick corrective action, if needed, while providing a better understanding of how to improve operations and processes.
- Track performance regularly – Companies need to track how their contingent workforce is performing to identify improvement areas and ensure that the workers are meeting company standards. Performance tracking also helps organizations keep tabs on costs and expenses associated with their temporary staffers.
- Use contingent workforce management companies and technologies – By using a specialized solution, employers can streamline the onboarding process, quickly access talent from anywhere in the world, and monitor worker progress. These advanced technologies can also speed up the hiring process and reduce hiring costs when managing a contingent workforce. A well-designed system helps businesses maximize their overall performance, profitability, and efficiency for greater returns on investment.
By following these five tips, organizations can effectively manage their contingent workforce while ensuring they have access to the best and most qualified talent. With the right processes and procedures in place, businesses can maximize their overall performance, profitability, and returns on investment. To learn more about how KarmaCheck can benefit your contingent workforce hiring process, contact us today.