HRO Today December 2014 - 57
Contingent Labor
Larger organizations typically have the most varied
workforce, supporting a myriad of strategies and a vast
array of products and services that can be delivered on a
local, regional, or global level. For organizations growing
their reach and scope in a new region, ICs can support
these areas with needed expertise. Here, the company
may not have a particularly large physical presence but
still needs the knowledge base to meet objectives.
The Management Process
The maturity of hiring process for ICs varies by
organization size. Overall, 64 percent of respondents
indicated that they felt the hiring managers within
their organizations were educated about the internal
processes needed when obtaining an IC. But respondents
from organizations with more than 500 workers were less
likely than those from the small companies to report that
hiring managers were educated.
Large organizations often use procurement departments
for managing ICs, and the process can remain within
that department. One reason smaller companies have
more educated hiring managers is because they have to
be more involved in the process since it's their primary
responsibility.
Taking a step back, measures of education are subjective
and vary by organization. A company can measure
educated hiring managers by many metrics:
Figure 1
Issues When Using Independent Contractors
% Indicating
Concern
Monitoring of work relationship and independent status to maintain non-employee status
Addressing security concerns about access to systems and facilities
ICs being able to comply with state and federal regulations about operating as an independent
contractor. This includes tax regulations
Measuring the success of the IC's assignment
Concerns over background checks being complete and thorough
Hiring manager's willingness to work within system guidelines for getting ICs
Use of ICs for unique role, not as additional help already done by employees
Adherence to company employee practices, such as smoking policies, drug tests, etc.
Managing expectations about work day hours
65%
62%
62%
59%
57%
54%
46%
44%
43%
DECEMBER 2014 | www.hrotoday.com
[57]
* Knowledge of suppliers
* Classification or workers
* Process execution
* IRS and legal implications
The need to be very educated and adhere to the
right processes has never been greater with respect
to independent contractors. Increased government
oversight, spurred by the tax implications of classifying
workers as employees or independents; ever-increasing
security fears over access to confidential records or
customer data; and the need to find contractors in the
most remote or dangerous parts of the world all mean
the need to adhere to best practices is vital.
Concerns and Challenges
Hiring managers often view ICs as an extension of
the workforce that can keep an organization within
a budget. Unfortunately, recent changes in how 1099
workers are classified, driven by tax implications and
the Affordable Care Act, have increased emphasis and
regulations about a more precise definition of whom is
an independent contractor versus an employee. This is
the biggest concern of survey respondents-65 percent
find monitoring the work relationship and independent
status to maintain non-employee status as a challenge
(see Figure 1). There are a few ways to approach ICs to
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HRO Today December 2014
Table of Contents for the Digital Edition of HRO Today December 2014
HRO Today December 2014 - 1
HRO Today December 2014 - 2
HRO Today December 2014 - 3
HRO Today December 2014 - 4
HRO Today December 2014 - 5
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