The uncomfortable truth is that contingent workforce management in many organisations is falling short. While contingent workers provide a convenient and flexible resource pool, they are often classified incorrectly, non-compliant with governmental legislation or industry regulation, or sourced through a talent supply chain that lacks transparency and, in some cases, ethics.
Why does this happen? Because contingent workforce management often sits awkwardly somewhere between HR, Procurement and individual hiring departments. It falls into a gap where governance, oversight and ownership can go missing. It happens all too often and can be ignored all too easily.
Here are some of the signs indicating that your contingent workforce is in need of better governance. From limited visibility and fragmented supplier management to increasing administrative demands, organisations often face hidden challenges. Without the right processes in place, these issues can easily go unnoticed.
You have limited visibility across your contingent workforce
The contingent workforce moves quickly and tracking workers can be difficult – especially if sometimes those workers are hired through different processes. The fact is that many organisations rely on their contingent workforce to help them drive growth. But as the organisation and the workforce grows, it becomes harder to identify inefficiencies, manage spend and make informed workforce decisions. Better data around your workforce leads to better decision-making, at every level.
The Uncomfortable Truth: Governance often lags behind growth.
You have a complex supplier network without clear performance insight
For organisations to stay agile, managers need to be able to make quick hiring decisions. This often means that those hiring managers build their own agency relationships and have their own preferred talent networks and partners. Working with multiple suppliers can create unnecessary complexity when there is no clear way to measure supplier performance or consistency. Too many suppliers can create inconsistent processes, reduced accountability and unnecessary administrative complexity.
The Uncomfortable Truth: Stop hiring on a handshake.
Misclassification leads to increased risk
Misclassification of workers has already seen some of the world’s most famous brands fined huge amounts for the way that they have treated their contingent workforce. Misclassifying workers can affect their rights, the benefits they are eligible for, and the amount of tax they pay. It also damages the reputation of the hiring organisation, who are seen as mistreating their contingent workers.
The Uncomfortable Truth: Misclassification leaves workers exposed to huge tax bills.
A partner takes the pressure off
Managing a contingent workforce can place significant administrative demands on internal teams, particularly when processes are fragmented or manual. Many of these challenges can be addressed through a Managed Service Provider (MSP). By centralising contingent workforce management, an MSP provides organisations with greater visibility, stronger governance and more consistent processes across the workforce. This helps improve compliance, optimise supplier performance, reduce administrative burden and provide the workforce insights needed to make more informed decisions, without increasing pressure on internal teams.
If you’d like to learn more about how effective contingent workforce management can help you overcome these challenges, get in touch with us.