Navigating Temporary Talent

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The modern workforce is transforming at a speed never seen before. From the increasing knowledge-driven economy, to the rise of remote working, to the flexibility and variety that workers now demand from their careers.

At the centre of this evolution of talent supply chain management is the concept of a talent ecosystem. Simply put, this means having multiple different sourcing channels to tap into when you need to fill talent gaps.

Many organisations who depend on temporary (contingent) labour to meet flexible staffing needs are turning to talent ecosystems to mitigate the risks of global talent scarcity. But as you’ll go on to read, navigating these bumper-sized programmes can be a headache in its own right.

Hiring Managers

These are the individuals and departments that need workers to fill flexible working requirements. Hiring managers are responsible for the day-to-day management of both their permanent and contingent staff, including orientation and off-boarding.

Contingent workers often need to be managed differently to regular employees due to the inherent differences in how they are engaged in work. If the two are treated the same then this can inadvertently create a co-employment risk – implying a direct employment relationship between contractors and their ’employer’.

Effectively navigating this line between managing employees and contingent workers has become a special skill. This becomes even more problematic when you consider the complexities of managing temporary workers from many different geographical locations.

Due to their direct relationship with workers of all kinds, internal managers are a crucial ingredient in making the organisation a great place to work. The stronger their reputation for treating all workers well, the more attractive they become to potential talent, and the more they will be able to take their pick of the best workers for the task.

Hiring Manager Interdependencies

If there is a problem with the supply chain, then the hiring managers and teams are the ones who feel the pinch most keenly. Without a steady flow of talent, tasks go undone, goals go unmet, and money goes unmade. They are the teams who are currently struggling most with the current talent shortage.

Hiring managers may also need to stay aware of changes in independent contracting legislation. When dealing with staff placed by an agency, the agency is usually responsible for some level of engagement and support for each team member they place. However, when working with contractors and freelancers, a more direct approach – and clearer legal knowledge – will be needed.

Some managers are arguably making the talent shortage worse by offering permanent roles to temporary and contingent workers. Though it’s a sensible thing to want to keep good talent to themselves, they are taking valuable, movable talent out of the market.

Talent Acquisition & Procurement

Human resources and procurement may seem like odd bedfellows, but hear us out. Procurement teams are experts at purchasing new services, managing supplier compliance, juggling risks vs. rewards, handling the purse-strings, and generally underpinning the business’s high-level goals through purchasing decisions.

Talent and HR teams are increasingly moving away from the reactive, somewhat passive, approach in which vacancies are filled as they appear. Instead, they’re moving towards “talent acquisition”: a long-term, proactive strategy that seeks out candidates with specific skill sets to fill specific needs.

Done well, talent acquisition is a critical, strategic role which can be a key driver for long-term success and development. But if done badly, it can damage organisational reputation, waste money, and jeopardise bottom-line success.

With this in mind, let’s revisit procurement. When you blend the person-oriented skills of HR with the cost-and-risk juggling specialisms of procurement, you get a perfect skills-cocktail for handling contingent labour.

A mixture of these two skillsets can help recruit the best talent while keeping associated costs clear and controlled. Procurement’s experience with compliance and legal complexity also lends itself well to the constantly moving feast that is independent contractor legislation.

When the two teams come together, talent specialists can focus on delivering the overarching workforce strategy and procurement will make sure it’s done on budget and in line with the law. It really is a match made in contingent labour heaven.

Talent Acquisition & Procurement Interdependencies

These departments are increasingly moving away from the reactive, transactional nature of old-school hiring departments, in favour of strategic, long-term employment decisions.

Understandably, when the legalities around employment and contracting changes, these departments are the ones who need to sharply sit up and take note. With cases like Uber v Aslam in the headlines and legislation like IR35 starting to echo around the globe, it’s an interesting time for anyone who deals in people, contracting, and risk.

Talent teams also need to maintain an awareness of worker attitudes. Many modern workers, quite rightly, take a “work to live” attitude and value autonomy and flexibility over more traditional employment perks. Workers are also increasingly looking for meaning in their work and a social conscience from their employers – all things that HR teams need to bear in mind if they want to create an attractive workplace.

Talent Supply Aims & Concerns

Modern, especially young, workers are embracing a world of increasingly impermanent work environments. In fact, 60% of Gen Z (those born between the mid-90s and early 2000s) do not foresee staying in a position for more than two years. (No word on whether that is because they a more transient career path, or whether they simply can’t imagine a working environment stable enough to accommodate a longer tenure…).

Covid-19 was a real catalyst in the fight for flexible and remote working practices, with some companies using the pandemic as a case study to do away with their expensive premises altogether! This drive is felt worker-side too, with 57% of the British workforce wanting to continue working from home.

Our friends across the pond agree, with 60% of US workers with jobs that can be done from home saying they’d like to work from home all or most of the time, given the choice. Internationally, workers in 29 countries polled by Ipsos responded much the same, with 66% of workers thinking employers should allow for more flexible working in the future, meaning some days at home and some in the office.

Modern workers also want to work for organisations that proudly embody strong values of diversity, equality, and inclusivity (DE&I). 79% of workers said that a diverse, equitable, and inclusive company attracts top talent. Reportedly, employers with diverse, inclusive cultures also enjoy more of a competitive edge.

Proper management of contingent labour is essential, and if an organisation is large enough to be using multiple kinds of contingent labour then each supplier/agency will need to be communicated with differently.

Managed Service Providers (MSP), Master Vendors, and Agencies

These are the providers who source and manage contingent labour for companies. Though the terms and relationships differ depending on the kind of work being sourced, many large companies will engage with all of these solution providers as well as their own internal talent acquisition and HR teams.

●     Managed Service Provider (MSP): These often supply specialised, white-collar talent, such as highly qualified professional contractors. Depending on the nature of the work, they are often engaged on a time & materials basis or as part of a project team operating under a Statement of Work. They oversee the whole contingent labour lifecycle – from requisition to sourcing, worker onboarding to supplier management.

●     Master Vendor (MV): These agencies will generally operate directly with organisations to source more general workers including blue-collar, light industrial, clerical, and administrative roles. As their name suggest, they source directly from the market to attract, secure and retain the talent needed.

●     Temp Agency: These are recruitment agencies who specialise in finding temporary work. These agencies work in a quite reactive manner, filling roles as they appear.

Due to the established, white-collar markets that they serve, MSPs and MVs generally hold quite personal and long-term relationships with employers, maintaining their role as strategic, preferred suppliers. They also nurture long-term relationships with the workers they place, keeping them supported, informed, and engaged.

Temp agencies, on the other hand, can provide more of a reactive approach if needed, generally offering placements to workers on the “lower-skilled” end of the spectrum.

These providers are all essential go-betweens who link candidates with companies and provide intermediary services and support to both parties. They’re dedicated to helping companies fulfil their strategic talent acquisition needs and they’re on hand to act immediately if a position or candidate isn’t suitable.

MSPs, Master Vendors, and Agency Interdependencies

Agencies are also very much concerned with the changing nature of employment responsibilities and legal compliance around contracting. Seeing as they deal with both ends of the food chain – contingent workers and the contracting organisation – they need to be in complete lock step with the latest legislation.

Because these agencies are responsible for engaging with, contracting, and (most importantly) paying the individual contingent workers, they need to be able to support them as much as possible. They need to have a sound legal head to navigate the finer points of legal employment status and rights; HMRC, PAYE, and NIC responsibilities; and any legal volatility and “grey areas”.

Contingent Workers

We’ve worked our way through the people involved in the contingent labour ecosystem and have reached the other side – the people actually placed into contingent roles who show up (virtually or otherwise) and do the work. Contingent labourers do not have a permanent employment arrangement with the organisation for whom they are working, often operating on a “Statement of Work” or project basis.

Contingent Worker Interdependencies

Not having a direct relationship with the company you’re working for has its ups and downs.

Contingent working can be a great experience for some as it can provide the flexible and varied career that modern workers crave. But the transitory life of a contingent worker belies their need to feel nurtured, to be part of a cause, and to enjoy the same perks and opportunities as their employed peers.

Therefore, the psychological safety of contingent workers needs to be carefully considered. Though some research has shown that contingent labourers feel the same amount of psychological safety as their permanent counterparts, some may acutely feel the pressures of being “on borrowed time” and suffer a muted “employment voice” compared to their perm compadres.

It’s therefore crucial for the agencies, hiring managers, and even talent teams in the equation to step in and make sure their workers are happy and fulfilled. It’s in their best interests to make that organisation an attractive organisation to work for, after all.

Hiring managers therefore have an important task: offering some continuity and camaraderie to contingent workers; stamping out any “us and them”-ing between permanent and temporary workers; and giving contingent workers options once their contracts cease to aid continuity.

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