How to Manage Independent Contractors: 3 Approaches

By MBO Partners | ,

Updated Friday, June 5, 2020

consultants working in office

The Benefits of Engaging Independent Talent

Studies show that the independent workforce is continuing to grow year after year—our own research finds that 42 million Americans work independently. Enterprises can benefit from independent talent in many ways, including staffing flexibility, access to specialized expertise, and better control over employment costs.

But as businesses begin to use this valuable pool of talent, they must also evaluate their independent contractor engagement practices to ensure they are truly meeting their core objectives: reducing enterprise manager time, streamlining processes, minimizing misclassification risk, lowering costs, and ensuring independent contractor satisfaction.

3 Approaches to Independent Workforce Management

Businesses have many options when it comes to independent contractor engagement. From our experience in working with hundreds of enterprises, we have found that independent contractor engagement is typically approached in one of three ways:

  1. Rogue Engagement: This approach often leads to high misclassification risk, high cost, and inefficient use of enterprise manager time.
  2. Restrictive Engagement: This approach often alienates a huge percentage of the independent workforce and leads to an even greater loss of talent.
  3. Preferred Engagement: This approach provides independent talent with multiple engagement options, giving them more choice and providing more value in their relationship with their enterprise client.

Learn more about these three approaches to independent contractor engagement and the time, process, misclassification risk, and cost associated with each approach.