The New Staffing Reality: Workforce-as-a-Service

159406050Let’s face it. The dynamics of the workforce have radically changed over the past few years. Unemployment is holding steady at 7.4 percent. Unsteady economic growth is prompting employers to think twice about their staffing models. And without the safety net of employer benefits, a lot of talent is switching from being a traditional W2 employee to join the growing ranks of independent contractors. In fact, when it comes to IT professionals, 60 percent of them willingly joined the independent workforce.

What all of these factors have created is a new staffing model where businesses bring on skilled professionals for short-term assignments. For example, let’s imagine you need extra hands to quickly seize a hot market opportunity or you want to reallocate your staff to focus on a new initiative, yet need to sustain your existing product line. For companies in various stages of growth and development, the independent contractor model makes sense because it allows businesses to focus on operational efficiency and maximize productivity while reducing, if not completely eliminating idle time.

Of course, the concept of hiring 1099s is not exactly new. In many scenarios, a former colleague or a friend-of-a-friend was brought in for a specific task. What is new, however, is the way that independent contractor talent is identified, vetted and secured.

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Specifically, advances in technology enable us to not only access a skilled pool of talent that is located right under our noses, but also publicly share feedback on our experiences with the independent contractor. This way, we’re able to find the right talent when it’s needed, a.k.a. “Workforce-as-a-Service” (WaaS).

Going beyond job boards, online marketplaces or social media sites to identify and hire talent for short-term assignments, the WaaS model has three critical differentiators.

  1. Each assignment is fully protected with insurance against general liability, workers’ compensation and errors and omissions.
  2. The contract professional is properly classified as a 1099, therefore mitigating risks for the service buyer.
  3. There is a 100 percent service buyer satisfaction guarantee to support quality outcomes before the independent contractor is paid for completed work.

Let’s examine these three differentiators a bit more closely.

The insurance factor is significant yet can be easily overlooked. What service buyers and independent contractors need to be mindful of are gaps in coverage that can expose both of them to risk. Before a contract is put into place, make sure that the assignment is not just partially covered or that insurance is optional. You need the guarantee that each assignment is fully insured before an independent contractor arrives to a job site.

As for the second differentiator, we’ve all seen or heard about the huge financial burden associated with misclassification of independent contractors. As more businesses look to the WaaS model, they need to be sure due diligence is executed when it comes to properly classifying independent contractors.

Finally, in fairness to all parties involved in the engagement, satisfaction ratings must be consistent and specific to the task.

WaaS is the natural, next step in the evolution of our workforce. Yet for the model to be successful for service buyers and independent contractors, both sides must agree to and enforce the principles outlined by those three critical differentiators.

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Peter Cannone
Peter Cannone is the CEO of OnForce, a technology-enabled workforce solutions provider.

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