According to research, the alternative workforce is on the rise — these days, many millennials, in particular, are opting out of typical work patterns and are not afraid to take risks in the pursuit of professional happiness. The gig economy, broadly defined, encompasses a variety of work arrangements, including independent contracts, online platform employees, contract workers, on-call workers, and temporary workers. When elements include growing workplace flexibility, a global, distributed workforce, and advancements in Artificial Intelligence (AI) - all of which contribute to the future workplace – it's critical for HR to account for it when planning for the future.
Employers prefer to hire gig workers for a variety of reasons, including convenience and cost. The gig labor is only set to grow as more people seek self-employment, especially given that alternate work patterns like working from home are becoming necessary owing to the coronavirus. Even if your company does not now employ a large number of gig workers, this is likely to change in the near future.
Given the current economic climate, manpower plans are moving toward a gig workforce because of its extra benefits.
For starters, having fewer workers on the permanent payroll will dramatically reduce the company's salary expenses, as well as other employee-related overheads, and may even result in a reduction in compliance costs – something that is crucial in these times. Furthermore, with so many uncertainties, it assures a more nimble and adaptive workforce, which is also a requirement of the hour.
Both employers and employees are adopting the gig economy. At this point, I'd like to emphasize how crucial it is to carefully consider whether or not to take the gig route.
Simply switching to a gig economy as a cost-cutting tool can introduce a slew of additional issues that will cost businesses dearly in the long run. After that, how can HR plan for a smooth transition to a gig workforce once you're ready?
When a job function and responsibilities are clearly defined, most small or large organizations choose contingent labor. These could be project-based non-core roles with clear outcomes.
For example, suppose a company has taken on an IT project for the government. In that case, the HR team must evaluate what is vital to the business that may not be fit for gig employment due to security and confidentiality concerns. Keep in mind that things aren't always black and white. For example, a company may engage a full-time content writer, but if they require content for a specific topic or product line urgently, they will choose to have it done on a temporary basis.
Because the gig worker will be onboarded for a shorter time, neglecting important HR processes to get started quickly will do more harm than good to the project. Once policies are in place, HR must devise tactics to ensure that contingent workers are onboarded, appreciated, and assisted in becoming more engaged with their work, even if it takes a few more days to accommodate the gig worker.
From recruiting gig workers to retaining them, the HR team must ensure that clear protocols are in place. Although the recruitment procedure is small, it is not ineffective. Temporary or project-based staff should be onboarded as soon as possible.
The HR team must also have a procedure to assess the project more frequently and provide more regular feedback without confusing performance management. So, if you're thinking of setting up parallel systems for this workforce, you're on the right track.
After receiving numerous complaints, the Karnataka government moved to draught policies to ensure better working conditions for gig economy workers last year. This is a clear indication that gig labor is becoming the norm rather than the exception. Companies must examine various rules or form an entity (committee) to guarantee stronger protections against taxes and other potential concerns.
Depending on the situation and the unique customer, different gigs may necessitate a contract for each client and varied policies to enact and follow. Some of the things organizations must include in their policy are drawing up explicit engagement contracts, all-inclusive delivery-based payment terms, defined entry, and exit standards, stipulated employment period, repercussions of non-delivery, and separation policy.
When people modify their recruitment policies, there is always a period of transition. Gig workers can be disruptive to a team, and managers should be aware of this. Managers are unsure at times as well.
Despite their best efforts, managers might foster distrust in a team if they approach it incorrectly, with false expectations about conquering these issues. Managers must equip themselves and make appropriate use of gig resources.
Your supervisors should be educated on the similarities and distinctions between permanent and temporary employees. They must be skilled in evaluating talent and performance. Top personnel must be maintained, moved to more challenging assignments, and skillfully repurposed if necessary after the gig ends. The more time you can keep great talent, the more money you'll make from your recruitment and assimilation efforts. This is also true for contract workers.
When your organization decides to use more temporary employees for various initiatives, it's critical to explain the reasons and benefits to current employees on the payroll. There should be no bitterness, reservation, or demotivation as a result of this move. Improve internal coordination about why the company uses gig workers for various roles and set expectations properly to avoid rumors or possible negative communication about the topic.
Expectations are met, and trust grows. People must communicate with one another in order to build trust. Provide opportunities for full-time and part-time employees to interact informally and speak. Information sharing improves productivity and personal relationships. Teams with temporary employees must know exactly what each member of the team is expected to contribute to the project so that they can hold each other accountable to shared definitions of quality and collective success. It is also critical to receive feedback. Employees' need for recognition and feedback isn't limited to how they're compensated.
Positive reinforcement inspires and engages employees while also guaranteeing that positive behavior is repeated and shared – for both permanent and contingent employees.
Gig workers appear to be here to stay, according to all signs. Employers who figure out how to tap into this talent pool will have access to a pool of highly skilled and productive employees. However, successful management of the mixed workforce necessitates executives rethinking their conventional staff management approaches. And the key to success is to manage employees based on their human needs for coaching, feedback, and appreciation, rather than solely on their pay.
Giving a temporary employee a positive experience this year increases the likelihood that they will return next year. This saves time and money by avoiding finding, interviewing, and training a new employee. An employee who likes their time with the company will spread the word about it and can even serve as an informal ambassador. Finally, today's freelance worker may become tomorrow's most valuable permanent employee. As a result, having a suitable framework for them is critical.