Managing a contingent workforce: Pros and cons leaders should know

Image by mohamed Hassan from Pixabay

By Emma Worden

Contingent work has become extremely popular nowadays across countries and industries, a trend influenced by many factors. Not only is technology facilitating performance and allowing business leaders to hire people temporarily from all over the world, but talent is becoming more accessible while ensuring compliance is becoming easier with time. This creates an efficient and effective ecosystem for sustainable contingent work, and it can have positive effects on businesses of all sizes now and in the future.

That said, it’s also important to note the possible negative effects of hiring contingent workers, many of which you can easily avoid or fix. With contingent workers, managing your small business could become easier, but only if you take a proactive approach and resolve issues before they arise.

Let’s take a look at the most important pros and cons of hiring and managing contingent workers and how to make it work for your company.

Access the global talent pool

As a business leader, you’re always searching for that top-tier talent to fill your ranks, and with the evolution of digital technologies, you can finally expand your search on a global scale. You can choose to hire local contingent workers if you need people on site, but if you’re looking to fill remote positions and bolster your digital operation, then you can search for the best workers from all over the world.

This is especially beneficial to companies with limited financial resources, because hiring full-time locally can often make you breach your budget. On the other hand, tapping into different global markets will allow you to optimize your payroll expenses and hire temporary workers that charge less but don’t skimp on the quality of their work. This allows you to find that balance between paying for talented individuals without going broke.

Productivity could rise or go down

When you’re hiring and managing contingent workers, locally or internationally, the question of productivity is inevitably going to pop up. You know your full-time team, you know how to elevate and maintain productivity, but you don’t know your contingent workers that well. A big drawback here can simply be that they’re not motivated to be as productive as your full-time employees.

What’s more, they might not have the same tools that allow them to be more productive. As the leader, you will decide if this turns into a pro or a con. By investing in productivity from the start, you can avoid this common pitfall and set your new contingent workers up for success.

The key is to onboard them properly, provide training and guidance if necessary, and welcome them as a part of the team so that they can internalize your culture. Offer the same rewards you offer to your full-time employees for a job well done, and they will be more productive and satisfied.

Legal and compliance issues to avoid

One of the biggest possible drawbacks of hiring and managing contingent workers can be that daunting issue of compliance. Leaders who are inexperienced in contingent workforce management, especially the international kind, can have a difficult time reducing risk and liability. After all, navigating the murky waters of compliance can be scary and it can completely deter you from hiring contingent workers.

That said, you can easily turn this into an advantage for your business if you work with the right partners. In Australia, for example, this has become common practice. Because the cost of labor is so expensive there, companies nowadays rely on expert contractor workforce solutions in Australia that focus on ensuring national and international compliance. They achieve this with a dedicated platform, but also a team of professionals that specialize in the legal aspects of managing contingent workers.

Australia is just one example where compliance can be an issue, but no matter where you’re located, make sure to work with the right partners to turn this potential problem into a legal advantage for your business.

Focus on coordination and collaboration

A contingent workforce can be centralized or decentralized, or it can be a mix of both. Whatever the case may be, it’s important for your teams to stay connected and productive while social distancing and adhering to other COVID-19 prevention measures.

When you’re managing contingent workers, communication and collaboration may suffer if you don’t give them access to the same tools. Be sure to integrate your contingent workers into your communication system and your collaboration platform to allow them to seamlessly collaborate with the rest of the team.

Don’t let the culture suffer

A big drawback of hiring contingent workers is that these people are simply not a part of your company culture. That doesn’t mean that they’re unwilling to adopt your culture, but they won’t be able to do it if you don’t lead the way and inspire them to do so.

With that in mind, make sure they understand the pillars of your culture, and show them how you nurture that culture in your organization. Inspire them to join in through team meetings and by opening a dialogue between your full-time employees and your contingent workers. Before long, you will notice that these new workers are starting to become a part of your company culture.

Over to you

Hiring contingent workers can have major advantages, but it can also come with some drawbacks. Use this information to capitalize on both the pros and the cons, and take your business forward.


Emma Worden is a digital marketer and blogger from Sydney, Australia. After getting a marketing degree she started working with Australian startups on business and marketing development. Emma writes for many relevant, industry related online publications and does a job of an executive editor at Bizzmark blog and a guest lecturer at Melbourne University.

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