The Great Resignation and then the Great Reshuffle has led to the “gig economy” – employees are now questioning how and when they work, and for how long. An estimated 162 million people in the EU and US (20% to 30% of the working population) are already involved in the flexible economy as flexible workforce — freelancers, contractors and independent workers – 44% of whom do so as their main source of income, according to McKinsey. With the increase in flexible working options, and organizations hiring across geographies, the labor market and economy is undergoing tremendous changes.
As more people in the workforce are making the shift and looking for short-term contracts, it might be relatively easy to find contractors. However, deciding when they are needed, effectively communicating their roles, and evaluating their work to provide timely feedback remain a challenge. It is not uncommon for contract workers to experience clumsy onboarding, poor communication, and unexpected changes to their job descriptions.
Here are the best practices when hiring contractors.
1. Decide if and when you need contractors
The first step towards hiring contractors is for companies to decide whether they need their services at all. It is not uncommon for big organizations to have a need for an extra workforce during busy seasons. This can be the period around the end of a financial year or when a company is expanding and they need time to fill open (full-time) positions. Also, if companies are struggling with a skills gap, they might need to hire contractors immediately until they are able to upskill existing employees or hire new ones.
Many organizations that get into an exponential growth phase need specific talent quickly, but recruiting at this pace becomes a challenge. In such a scenario, a temporary staffing model can be helpful. For companies in the tech space, the requirement for contractors arises when they unveil a new service or product. This is when companies struggle to reach full velocity with in-house employees. Briefly, there are some situations where it is appropriate to use an independent contractor, for example: for short-term projects, projects that require specialized experience, and for temporary assignments for less than a year.
2. Source the right contractors
Finding potential contract workers who will fit a company’s requirement is not a hit-and-miss approach. It will require a well-thought out sourcing strategy. Often, hiring managers have a lenient attitude towards hiring contracts. If they are not full-time employees, the thought process might be something along the lines of questioning the need to be extra cautious, given that it’s relatively easier to let go of contractors who don’t fit the bill. However, this isn’t true. Companies stand to lose.
A lot goes into finding and onboarding an individual, even a contractor, so it’s important to get it right. When interviewing contractors, it’s critical to focus on skills that they possess in the context of the tasks they will be performing. Asking candidates why they think they are a fit for the project is one way to do this. When using a vendor to hire contract workers, take the time and make the effort to build a long-term partnership as it will serve the company well in the long run. If a vendor sees long-term potential in the partnership, they are more likely to go the extra mile and present you with the best matching candidates.
3. Make onboarding easier
One of the biggest challenges contractors face is clumsy onboarding. They are not full-time employees but are equally important as long as they are associated with the company’s projects. This is why companies must make the onboarding process as easy and seamless for contractors as they would for full-time employees. It’s important that companies are ready to answer a contractor’s queries and show them around, virtually, in many cases. Let them know what level of security access they have as contractors, and openly discuss their roles and the kind of autonomy they will enjoy, to enhance clarity. Introduce them to the company policies that apply to them and any administrative requirements they must adhere to.
Introduce contractors to their team, set up introductory meetings, and provide them with necessary equipment and tools for the job. In short, companies must do all things to onboard contractors that they would do for a new employee. Unlike full-time employees, contractors will not be motivated by the perks, but by the way they feel at the workplace. Companies should focus on making a real connection with each contractor.
4. Keep an eye for talent
What truly makes a business successful is the versatility of talent in the organization. With some effort, anyone can clone services or products, but not the talent that a company employs. Human talent is the single most valuable competitive advantage a company can have today. This is the reason why procuring a smart workforce can create an unmatched game-changing environment for companies.
While hiring contractors as temporary employees, companies also need to keep a close eye on their skills set. If, during the course of the project, companies identify potential in contractors, the smartest thing to do is to hire them. Even if the company has not fully figured out where the contractor will be accommodated as a full time employee, hiring skilled talent will give the company a head start.
5. Don’t hire without cybersecurity tools
Over the last decade, cybersecurity has become a major concern for businesses. Experts warn companies to use the right tools when hiring to avoid security breaches. A common assumption among organizations is that only tech companies require cybersecurity, but this is a grave misconception. Any company using a software tool with connectivity to the internet is susceptible to cyber-attacks.
This is why companies need to take precautions when hiring remote workers in the form of identity verification. It is not uncommon for criminals to fake identities and take advantage of the remote workforce to gain access to your business. According to data security firm Varonis, the average cost of a data breach attack is $3.86 million. They further warn against the rise of attacks against remote workers with the aim to get access to cloud infrastructure. Companies should make cybersecurity a priority when hiring contractors, so as to avoid being an easy target for cybercriminals.
6. Assess and review performance
Assessing talent is as important as identifying it. Once a company has hired contractors, the next step would be to assess them in detail. Having the right assessment tools becomes critical here, otherwise there’s a risk of getting this wrong.
Companies can start by being clear about the goals and expectations. And then have an honest and open conversation with contractors, and share feedback about performance just as companies would do with full-time employees. As contractors need to make quick adjustments in performance due to compressed timelines, it will be productive if companies provide them with detailed feedback. If companies have a large temporary workforce, it becomes important to set up processes to support and coach contractors so they have a positive experience. How companies make contractors feel will directly translate into a brand’s reputation in the marketplace.
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