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Independent Workforce Resources
Communication, clarity, and honesty are three key components to a successful project. These qualities build respect, trust, and confidence between employers and employees, and the same principles can be applied to developing a strong client-contractor relationship. Establish a successful relationship with your contingent workforce with these five tips.
1. Review Your Objectives Before Starting Work
A successful client-contractor relationship begins at the start, with a clear Request for Proposal (RFP). An RFP shouldn’t be long or overly complex; aim to clearly present your specific project needs by outlining specifications and requirements.
Before drafting an RFP, be sure to conduct a thorough internal needs assessment with all relevant stakeholders so no surprises or additional requirements show up later on. Your RFP should clearly define the scope of the project, but not be so specific that it would prevent a prospective independent professional from being able to propose a creative solution to your problem.
2. Engage the Right Talent for Your Needs
When reviewing responses to your RFP, consider the ability of each independent professional to perform the necessary project requirements. You want to make sure the person you choose to engage has the knowledge, expertise, and resources needed to complete the job.
It’s also important to think about the solution they propose. Is it realistic based on your budget and current operating procedures? Once you’ve identified a few possible candidates, consider conducting in-person interviews and taking a look at samples of work in order to make sure you have the right fit for your project.
3. Use a Contract to Define Your Business Relationship
Once you’ve found the right independent professional for your project, you’ll want to define your business relationship with a contract. A service contract is a binding agreement between you and the independent professional you’re engaging that outlines specifications such as a start and end date for the work, as well as procedural and operational requirements. This is a good opportunity for you and the independent professional you’re working with to sit down and discuss resources, restrictions, and terms of your engagement.
4. Use a Scope of Work (SOW) to Establish Rights and Responsibilities
The Scope of Work (SOW) is an essential part of the service contract. A SOW defines tactical and functional requirements of the project. It outlines what the independent professional is and is not responsible for, provides detailed timelines and milestones for deliverables, and sets expectations for a completed product. A well-defined SOW protects both your business as well as the independent contractor by establishing rights and responsibilities of both parties and limiting liability.
When discussing and writing a SOW, be sure to include responsibilities on your end such as background resource materials that may need to be provided, access to systems and data if applicable, and reasonable timelines for review periods. Keep in mind that there are a lot of shared responsibilities between you and the independent professional that need to be discussed and written down in order to successfully complete a project. A SOW sets the foundation for good communication, so take time to discuss details and define a SOW that will work for both you and the independent professional.
5. Starting Small to Find the Right Candidates
If possible, start by evaluating independent contractors on smaller projects before committing to larger ones. This way, you can get an idea of their working style and communication methods that work best. Finding the right independent contractor for your business needs can take time. It’s worth working through a few smaller projects to find the right candidate who not only has the skills and talent you need, but who also operates well with your work style.
Do you have more questions about how to best engage independent professionals for your business? Contact us today.
Virtual Event: Register here!
Thursday, October 14, 2021 at 2:00 PM – 3:00 PM ET
- John Henkel, National Director, Recruiting – Advisory at KPMG
- Audra Nichols, Senior Vice President, Digital Solutions & Methods at UnitedLex
- Bob Lucas, Senior Vice President, Enterprise Solutions at MBO Partners
- Miles Everson, CEO of MBO Partners
MBO’s October Future of Work session highlights the growing trend of organizations to directly source talent-bypassing traditional third-party labor sources-to not only establish talent pools and virtual benches of at-the-ready talent, but also to create direct relationships with the country’s top skilled labor.
One of the most valuable resources to organizations today are independent professionals. This component of your total workforce can bring in much-needed expertise, best practices, and delivery capabilities.
However, that value can be quickly lost without internal buy-in. Adherence to and understanding of your contingent workforce management program is critical to remaining compliant, attracting top talent, and ultimately becoming a forward-thinking leader both to peers as well as to the independent professional community at large. Use the following 10 tips to drive program adoption within your organization.
1. Outline Why Program is Important
Whether the goal of your contingent workforce management program is to drive efficiency, save costs, or mitigate risk, a strong and clearly articulated business case will help build a solid foundation for program adoption. Your business case should clearly show the ROI of using independent workers, define overall goals, and outline policies and procedures.
2. Educate Executives and Key Stakeholders
To drive program adoption, executives and key stakeholders will need to champion your contingent workforce management program. Be sure to involve these figures in the program design process. Go into these discussions with a clear focus of how the program benefits your organization’s financial and competitive performance. With executives and stakeholders on board, you will be able to more efficiently and effectively message the program throughout your business.
3. Identify Barriers to Adoption
Are there hiring processes, employee concerns, or other issues that could be a barrier to program adoption? Identify internal and external factors that could disrupt the success of your contingent workforce management program and mitigate these risks in advance by creating plans to counter possible setbacks.
4. Establish Rules for Onboarding, Engagement, and Management
A contingent workforce engagement policy should articulate the reason for your program, and establish roles and responsibilities for all parties involved. Develop a standardized program plan with clear rules for identifying, engaging, and managing independent contractors. Define who will own compliance across the program, and ensure that key stakeholders and resources are committed to driving adoption.
5. Streamline the Approval Process
A key component to adoption is designing a program that is easy for internal teams and independent contractors alike to use. Create a streamlined approval process that does not hold independents or internal requestors hostage to bureaucracy or extraneous rules geared towards engagement of traditional employees.
6. Test Technology with a Soft Launch
If you are using an online marketplace or technology platform to engage or manage independent workers, be sure to thoroughly test your systems with a soft launch before rolling out the program. This will ensure you have the time to properly train and prepare staff, make any necessary changes or adjustments if glitches occur, and determine the best strategy for a future hard launch.
7. Track Program Performance
Tracking and measuring your program’s performance is a useful way to gather and communicate results to internal staff. Use these results to refine or enhance the program as necessary.
8. Assess Contractor Performance
Include a process for benchmarking the performance of independent contractors. This will allow you to identify top-performing independents that you can target for future re-engagement opportunities.
9. Communicate Clearly and Often
Communication is a cornerstone of adoption. Ensure that your independent contractor program is visible throughout your organization by educating employees on program policies and processes, and by providing them with reports on program performance.
10. Ask for and Implement Feedback
Ask for feedback from internal users as well as independents. It is important to understand the needs of both audiences and to use their experiences and feedback to improve your program. Remember, your independent contractor program is a dynamic process. Assess your program regularly to look for opportunities to improve.
The most well-designed independent workforce program will fall flat if it does not gain adoption. To be successful, you need to secure program adoption from both internal users and independents.
To learn more adoption strategies, discover what MBO Partners can do for you.
Any enterprise that uses independent contractor talent needs a comprehensive compliance program. A compliance program serves to minimize a company’s exposure to misclassification liability. By law, independent contractors represent a different category of worker than W-2 employees. That means that just because someone wants to work as an independent contractor, doesn’t mean they meet the specific criteria to legally do so.
If a company misclassifies a worker as an independent contractor when they should really be an employee, the company may be liable for fines and penalties, and can even be hit with a class-action lawsuit. Businesses that engage independent contractors for projects that require a high degree of specialization in an area of expertise need an extensive level of compliance. In order to operate legally, it is important to understand existing contractor compliance guidelines and laws. Below, we explore three key benefits to building a contractor compliance program at your organization.
1. Learn Where You Stand When It Comes to Compliance Risk
There are many inherent risks in engaging independent contractors: insufficient insurance requirements, unpaid taxes, misclassification, and rogue enterprise managers, just to name a few. Independent contractor classification and engagement are complex processes, but must be followed in order for businesses to remain compliant and avoid IRS audits.
A compliance program helps to minimize the risks associated with misclassification. In order to create an effective program tailored to organizational needs, many businesses choose to partner with a firm that specializes in independent contractor engagement and compliance that can indemnify the enterprise from misclassification and legal risk. Companies like MBO can provide valuable strategies, tools, and advice to help enterprises create sustainable contractor compliance programs.
2. Strategically Manage Independent Contractor Spend
Without a defined program in place for independent contractor engagement, management, and payment, a company can incur a variety of costs. First, the risk of misclassification in and of itself can be quite costly. Businesses can be liable for paying back-taxes, penalties, and benefits to misclassified workers, and dealing with lawsuits and reputation damage can add an additional financial burden.
A common fix for misclassification risk is to engage workers as W-2 employees on a payroll program. However, these programs tend to be quite costly and independent professionals often don’t want to be engaged this way, leading them to take their services elsewhere or look for ways to circumvent this type of classification—a practice that can circle back to rogue engagement and misclassification.
Without a defined program, it is also difficult for businesses to strategically manage independent contractor spend as a category. When a business does not have visibility into how its independent workforce is managed or paid, it becomes really difficult to drive cost-savings opportunities.
A well-rounded program serves to eliminate these burdens. Providing flexible engagement options that appeal to a broad range of independent work engagements and worker types helps to mitigate misclassification risk, allows talent to work the way they want, and gives businesses the insight and data they need to efficiently manage independent contractor spend.
3. Boost Work Efficiency
Lastly, a contractor compliance program increases visibility into the expenses and profitability of using independent professional talent, as well as boosts the efficiency of filling a project need with qualified talent.
With a defined program in place, it is much easier to manage factors like independent contractor-related expenditures and talent rates. Over time, this increased visibility can help organizations realize significant cost savings. Technology can also be used to support a program, helping to eliminate administrative burdens by giving managers the tools to efficiently find, engage, and manage independent talent.
Although the details of instituting a contractor compliance program can seem overwhelming, risk control, cost savings, and increased efficiency and visibility are all very tangible benefits that will help your business remain both legally compliant and competitive among peers.
Do you have more questions about how to create a compliance program for your business? Contact us today.