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The contingent workforce will be a major part of your HR strategy in the very near future. Are you ready?

By Melissa Campeau


If your organization hasn’t already added contingent workers to its talent mix, it’s a safe bet it will be – in a big way – in the very near future. According to staffing firm Randstad Canada, non-traditional workers already make up 30 per cent of the Canadian workforce, and they forecast that number will exceed 35 per cent by 2025.

It’s changing the nature of how HR managers think about, plan for, recruit and engage the best talent. It’s even changing the way businesses think about getting work done.


All walks, all ages

The first thing to know about this quickly growing group of professionals is that, by and large, they’re skilled professionals who are intentionally choosing a non-traditional work model.

“This is the way many people want to work,” said Jeff Nugent, managing director at Contingent Workforce Solutions. “Plenty of workers find they can make more money, have more flexibility and can choose the work they want to do.”

In fact, a recent study by ReportLinker found freelancers were generally more optimistic and happier than traditional workers, and 84 per cent of them said they are able to find a sense of purpose by working in the gig economy.

The non-traditional workforce includes every generation, too. Millennials, for example, with niche knowledge and a little in-office experience under their belts, may decide to become their own bosses and shop their skills around, content to work short periods in exchange for an interesting project and a chance to learn. Having grown up with tech, they’re at home working remotely, too – something that factors into many “gig” opportunities.

“Millennials’ relationship with technology influences how this generation wants to work, how they expect to work and how they engage,” said Nugent. “The gig economy to me is like the canary in a coalmine for a broader demographic’s expectations and changes.

“Boomers make up a big part of this group, too,” said Nugent. “They may have been downsized over periods of time and at this point in their career, don’t want a traditional job, but also don’t want to stop working.”

A company might be parting with decades of experience when they lose a Baby Boomer, along with that person’s wisdom and maturity. If they can hire back that person as a consultant – but for 12 hours a week rather than full time – that can be a win for everyone.

If freelancers include just about every generation, they also represent a wide range of professions. Some, though, are more common than others.

“We found there are definitely more freelance jobs for certain career fields,” said Brie Reynolds, senior career specialist at FlexJobs. At the top of the list: IT-related posts, followed by posted jobs in the fields of accounting and finance, HR and recruiting, writing and editing, administrative work, project management and data entry.


Freelancers: Myth busting

“There is a belief out there that people are freelancers because they’re not able to find traditional employment, and we’re seeing that this is not the case at all,” said Reynolds. “Instead, these professionals see their skills as an asset that they would like to offer to different clients and they don’t necessarily want to be beholden to one employer. I think that speaks to their level of experience and skill, and the confidence they have that they can be hired in that way.”

With future employment often based on the quality of the work at their last gig, word of (social media) mouth and repeat business, freelancers are generally highly motivated to meet or exceed their client’s expectations.

On a related note, organizations may have concerns that workers in non-traditional roles won’t be as committed to an organization as traditional full-time employees.

“In general,” said Nugent, “the loyalty that used to be there between employees and employers is just not necessarily there on either side now,” even for traditional workers. “There is loyalty, though, when each party brings value to the relationship, and that can absolutely happen with a non-traditional workforce.”


What’s in it for us?

With just about every organization looking for efficiencies to stay competitive, contingent workers offer a compelling argument. The ability to scale a workforce up or down quickly or assemble a global team of experts at a moment’s notice is appealing, and it all comes without the typical expenses of traditional workers.

Hiring contingent employees can help reduce risk during times of uncertainty or cautious expansion, too.

“You’ve heard of the oil patch downturn in Western Canada, but in the contingent workforce, there’s actually been growth in this part of the country,” said Nugent. “Contingent workers were always a large component of the workforce there, but with the economic uncertainty it’s become a huge component of the workforce.”

There might be other times when a team would benefit from a fresh, external perspective, when solving a problem or trying something new.

“One big advantage for organizations is the expertise and specialization that they can often find with the freelance worker,” said Reynolds.

For those who craft and plan the talent mix in an organization, it can mean something of a paradigm shift.

“Boomers and GenXers often have a very defined world view, limited by a traditional understanding of what work looks like: eight-hour days in an office, for the most part, with some evolved companies looking at remote work,” said Brian Peña, senior vice president of Contingent Workforce Strategies. “But there are dozens and dozens of ways in which people can be engaged to get work done and often those new modes of working are going to be more desirable.”

It’s no longer about what needs to get done, but about finding the best way to do it and determining the best resources.

“You have to challenge all of your preconceived notions about how you see projects being successful in your company,” said Peña. “If you’re expecting in 10 years to have a large number of your people sitting in offices from nine to five, that’s just not going to work. The gig economy strategy is not just about ‘Do I use a temp from Adecco or Manpower?’ It’s about, ‘Okay, what’s the best way to get this done amongst the variable resources available to me to accomplish the task?’ It’s no longer the war for humans, but the war for outcomes.”


Is your organization ready?

To lay the groundwork for a varied talent ecosystem – one that can offer equal support to contingent workers – Human Capital Trends 2018 by Deloitte recommends that organizations extend their existing talent management strategy to all workers. The report suggests HR teams work with legal professionals and IT to make sure contract, gig, freelance and all non-traditional workers have clear performance goals, secure ways to communicate and adequate training and support.

Human Capital Trends 2018 also says that organizations should provide contingent workers with the same onboarding and development opportunities as other employees. The report notes: “Perhaps because organizations fear these workers will become categorized as ‘full-time employees,’ nearly half of the HR respondents to our survey (46 per cent) say they are not involved in onboarding alternative workers, and more than half (55 per cent) do not support training for this population.” The report suggests most employers are currently treating alternative workers as unskilled labour, rather than the professionals they are.

The Deloitte report also suggests organizations consider ensuring incentive programs cover the entire range of workers, including contingents. As with traditional workers, HR can consider what skills and capabilities these workers might want to develop, how they’ll be measured and so on, all in the name of improved performance and a better experience, too.

Contingent workers, just like traditional workers, become ambassadors for an organization.

“When non-traditional workers go to social events or industry events and say where they work, they don’t say they work for Adecco or Manpower, they’ll name your company,” said Peña. “They’re your brand emissaries just like anyone else.”


Screening and tracking

Contingent workers likely have access to data, communication channels, customers, partners and even financial information, so it makes sense they should undergo the same rigorous screening and consideration given to permanent employees. However, according to a 2017 report by the U.S.-based Sterling Talent Solutions, only 30 per cent of survey respondents did any screening at all on their contingent workforce, compared to 89 per cent who perform checks on full-time salaried employees.

Frequently, though, contingent workers are hired quickly (that is, after all, one key advantage of freelancers). That need for speed can preclude an organization from carrying out its typical, thorough screening process. Third parties, including staffing organizations, can help fill this need. A reputable staffing company will have already thoroughly screened and assessed any potential hires, so a suitable candidate can be brought on without delay. Human Capital Trends 2018 recommends that HR stay involved in selection decisions, though, and engage in the cultural, skills and other forms of assessments used for full-time employees.

When using a third-party company, keep in mind that all staffing firms are not equal.

“An increasing number of so-called temp agencies share the temp category with Association of Canadian Search, Employment and Staffing Services (ACSESS) members and other established staffing firms, but their legal compliance, as well as their professional, ethical and safety standards are a sharp contrast,” said Mary McIninch, executive director, Government Relations with ACSESS. “They often prey on vulnerable, unskilled workers, who they randomly select, give marginal – if any – training and minimal support.” Once placed, these companies have negligible interest in each worker’s success. “Single owners may run several fly-by-night operations that hide behind slight variations of familiar company names, authentic-looking websites and references, which quickly disappear when issues arise.”

In some provinces, legislators are cracking down on this issue. In Québec, for example, the new Bill 176 will target fly-by-night agencies that don’t uphold ethical, safety and professional standards by requiring all staffing agencies to obtain a permit to ensure they are performing in adherence to provincial standards.

Even among reputable staffing agencies, there are important distinctions.

“Many are regional and understand and specialize in the needs of their local market and have developed strong relationships with their business communities,” said McIninch. “Others are global leaders that specialize in a specific industry and skills such as engineering, accounting, IT or the trades.”


Stay on top of legislation

While the contingent workforce offers plenty of benefits, missteps can mean tax troubles and legal hot water. Hiring contractors who essentially function as full-time permanent employees, for example, has been a hot-button issue for the Canada Revenue Agency for several few years now.

Equal pay is another contentious issue, with serious repercussions for anyone not compensating contingent workers according to the law. Recent legislation in Ontario, for example, enforces equal pay for equal work.

“In Ontario, Bill 148 says if you have contactors who are getting $20 per hour sitting beside someone making $100k a year for the same work, that person could sue you for the difference,” said Nugent.

“As the work landscape becomes more varied and complex, HR professionals who manage contingent workers need to partner with their internal experts to hone up on the legislative requirements of each employment arrangement,” said McIninch. The staffing industry is among the most highly regulated industries in Canada. “It’s critical for HR professionals who manage contingent employees to keep abreast of legislative changes to ensure they are complying with all laws and protecting the mutual interests of their organization, clients and candidates.”


Future of HR is scientific

Clearly, there’s a lot to consider when planning a talent ecosystem.

“To be strategic, HR needs to become like a science unto itself,” said Peña. “The future of HR is a scientific one. It’s about being able to create a complicated strategy that leverages cognitive resources to be able to solve business problems and seek competitive advantage.”

Peña sees the pace of change as an opportunity.

“So much of what we hold near and dear is going to be changing, so for the function of HR to survive, it needs to move beyond doing what you were taught at university,” he said. “Be curious. Become a student of the workforce of the future and be prepared to solve workforce challenges in a new way. The companies that can embrace the non-traditional workforce with the same fervor and attention they give their salaried employees are the ones I see being really successful.”



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