With the COVID-19 pandemic continuing to shape the future of work, employers and HR leaders have been forced to rethink and reset their management, performance and workforce strategies. To quote Gartner Group Vice President, Brian Kropp: “It’s critical for business leaders to understand that large-scale shifts are changing how people work and how business gets done. HR leaders who respond effectively can ensure their organisations stand out from competitors.”
Given that business continuity is currently under the spotlight, organisations are increasingly exploring ways they can remain flexible. Analysis from Gartner found that 32% of organisations are replacing full-time employees with contingent workers as a cost-saving measure. While such a hasty scaling back of a permanent workforce can save costs, what happens when a business needs to increase capacity quickly in the future? Or they urgently require new skills to cope with a change in direction?
It’s for these reasons that businesses are turning their attention to developing or bolstering a contingent workforce strategy. While we know that contingent workers provide much-needed flexibility, employers must have the right combination and type of workers in place if they want to keep costs to a minimum. There’s also the impending change to the IR35 legislation to consider, which could create more work and, critically, carry greater risk.
Time to take control
Many organisations have little visibility over their contractor population, with some unable to confidently state how many contractors they have working for them. Such a lack of clarity presents several challenges:
- Cost. Forecasting labour costs is difficult if you don’t know who you have in the business, what you’re paying, and how long these workers need to be there for. Without central governance around how contingent labour is procured, you will likely be paying more than you need to.
- Usage. Contractors can be highly-skilled and valuable additions to the workforce. However, if they’re engaged to fulfil an urgent need but were extended again and again, you may fall into the trap that many organisations do, where contractors possess an intimate knowledge of the business and become single points of failure.
- Compliance. There are many pieces of legislation you need to take into account when hiring contractors. If you or your supply chain don’t have the correct documentation and processes in place to hire these workers compliantly, you could risk significant financial penalties.
Help is at hand
With these challenges in mind, Omni designed a 3-stage process to help employers take control and get the most of their contingent workforce:
- Stage 1: Discovery. We identify all contingent workers engaged by your company – either paid directly, via an agency or a subcontract supplier. If any non-compliant contractors are discovered, we provide a plan to help you achieve complete compliance.
- Stage 2: Contingent Workforce Optimisation. We look at whether you’re engaging your contingent workforce in the most efficient way. Each role carried out by a contractor is reviewed to establish whether there’s a better, more cost-effective way of providing that resource. We create a plan to help you enforce these changes, ensuring business continuity and delivery is maintained at every step.
- Stage 3: Future-proofing. The nature of a flexible workforce means that it’s constantly changing. If you’re not set up correctly as a business to record, monitor and govern the use of contractors, you’ll find yourself back at square one, with a non-compliant and costly workforce. We help you ensure this doesn’t happen.
Download the Life After Lockdown guide
Omni’s team of resourcing transformation specialists explore the critical areas of your business that require immediate attention as you move out of lockdown in our Life After Lockdown guide. Download your copy today.