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The Direct and Indirect Costs of Independent Contractor Engagement Methods

   |   MBO Partners   |   December 4, 2018


The independent workforce is an increasingly essential part of the talent ecosystem for many organizations. In order to realize cost savings from this valuable pool of talent, businesses need to evaluate their workforce strategies to ensure they are doing everything they can to accommodate these workers.

By becoming aware of the direct and indirect costs associated with various engagement methods, enterprises can develop smarter strategies for their independent workforce and realize a distinct competitive advantage among their peers.

Gray-Zone Independent Professionals

When engaging independent professional talent, it is first important to truly understand the diversity of the independent workforce. Independent professionals have individual preferences and requirements as well as differing levels of self-employability. This means that some workers will clearly meet legal qualifications to be classified as an independent contractor, whereas others may better fit a standard, W-2 employment status.

But the most significant number of workers actually fall into the middle of the spectrum as gray-zone workers. These are people who wish to work independently, but do not fully meet the legal requirements of being classified as an independent contractor.

The Cost of Independent Contractor Engagement

Businesses tend to handle engagement by either leaving managers to their own devices to fill talent needs or by using strict, one-size fits all program. Unfortunately, both of these methods have high associated costs and risks. In order to successfully engage this gray-zone talent, organizations need to offer flexible engagement options that appeal to a broad range of independent work engagement and worker types.

Learn about the costs associated with different independent contractor engagement methods and review a case study to see cost savings in action.


MBO Partners

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