Contingent Employees

  1. How does the employment of contingent employees affect an organization’s business, its HRM responsibilities, its overall costs, and its organizational culture?

Contingent employees are great assets with whom the organization should develop a positive relationship. These types of employees have immense effects on an organization’s business, its HRM responsibilities, costs, and organizational culture as evaluated herewith. With the organization’s business, contingents have an effect of making organizations turn its business process into tangible projects with definite start and end and with measurable outcomes, as explained by Trkman, Mertens, Viaene, and Gemmel (2015). This enables organizations to plan and have clear roadmaps in relation to the outcomes and objectives of any business that the organization engages. 

Contingent employees have a dimension when it comes to HRM responsibilities. Contingent employees affect all the compensation, instructional mode, development of a high-end motivational strategy, and evaluation procedures. Contingent employees require specific instructions complete with timelines and outcomes. Further, the calculation of compensation is tied to such outcomes and timelines, unlike ordinary employees where compensation is tied to the concept of time. Further, with contingents, motivation is not necessarily a contractual obligation, but it is important to have it featured in the process of working together as explained by Buch, Kuvaas, and Dysvik (2010).

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Costs and organizational culture are important areas where contingent employees affect an organization. Contingent employees are engaged when it is necessary. This means that labor costs in this sense, are tied to output. As such, there is no expense without a realistic expectation for improved output, unlike permanent employees who are paid regardless of whether they delivered or not. With the culture, contingent employees affect the business by instilling a culture of knowledge creation, competitiveness, safety, and a results-oriented workforce as explained by Matusik and Hill (1998). 

  1. In your educated opinion, should the compensation of contingent workers be the same (on a pro-rated basis) as conventional, full-time employees doing the same work? Discuss, bringing in both the strengths and challenges this approach presents.

Compensation of contingent workers should be entirely different from that of conventional full-time employees doing the same work. Managers need to acknowledge that contingent and conventional full-time employees are hired on different regimes. Though the legal directions of hiring contingent employees need to be internalized and applied, the overall feeling is that the two sets of employees are not necessarily the same because they are performing the same job. Due to differences in their terms of engagement, it is necessary to have the same differences reflected in the compensation policy. Contingent workers are a one-time expense that is engaged only when it is necessary. As such, these kinds of employees take risks, more so the risk of being out of work. 

Considering differences such as insurance, statutory contributions like social security, retirement policies, and sick and annual leaves among others, a contingent worker is not offered such benefits though some of them are necessary, such as health insurance. As such, the contingent employee needs additional compensation to ensure that they have a scheme that covers their health and other social aspects. Further, a contingent worker is not assured of income past the expiry of their contract. In this case, they face a constant risk of being out of work. This raises the ultimate question, who compensates them for taking such a risk? It is factored in the contract and on fair terms, they are justified to do so. To make contingent work more attractive, such risks must be compensated otherwise people will prefer to be conventional workers even when the odds are against the idea. With contingent employees, company’s responsibilities are reduced in that the company does not have to worry about remitting taxes and other statutory requirements. In addition, they reduce the fixed costs of companies, which reflect positively on the company’s finances. As such, a little motivation is needed to make contingent work more admirable. 

  1. How would you, as the CEO of the company, create a sense of engagement with the infusion of contingent workers in a workplace that historically consisted of conventional, full-time employees?

Creating a sense of engagement with an infusion of contingent workers in a work environment that has long consisted of conventional full-time employees, is a job that requires consistency and strategizing. It is a process that should include both simplistic and complex processes that get all types of employees together and reading from the same script. To achieve this, the following activities can accelerate the achievement of the goal. 

The first step to bring this kind of harmony is cultivating respect and recognition. Contingent and convectional employees need to be treated with respect as explained by Fisher, Wasserman, Wolf, and Wears (2008). None of them should be stereotyped or profiled. All employees need to feel valued and that their contribution towards the goals and mission of the company is not taken for granted. The company should recognize employees who do a good job whether they are contingent or conventional. Outstanding members should be publicly announced in settings such as luncheons. Contingent employees need to have corporate emails and receive invitations to meetings and gatherings. This way, they will create camaraderie among themselves and conventional staff. 

To ensure that there is a smooth process of inducting contingent employees, there should be onboarding and training opportunities for contingent employees. Conventional employees normally undergo an onboarding process. The same should be offered to contingent employees. They should be taken for facility tours to meet other workers, as well as, have an understanding of the company policies and rules and regulations. Onboarding will make them feel welcome and will go a long way to start a healthy working relationship. The necessary training to contingent workers should be offered to contingent workers to ensure that they are operating with the understanding of the right context. 

References

Buch, R., Kuvaas, B., & Dysvik, A. (2010). Dual support in contract workers’ triangular employment relationships. Journal of Vocational Behavior, 77(1), 93-103.

Fisher, S. L., Wasserman, M. E., Wolf, P. P., & Wears, K. H. (2008). Human resource issues in outsourcing: Integrating research and practice. Human Resource Management: Published in Cooperation with the School of Business Administration, The University of Michigan and in alliance with the Society of Human Resources Management, 47(3), 501-523.

Matusik, S. F., & Hill, C. W. (1998). The utilization of contingent work, knowledge creation, and competitive advantage. Academy of management review, 23(4), 680-697.Trkman, P., Mertens, W., Viaene, S., & Gemmel, P. (2015). From business process management to customer process management. Business process management journal, 21(2), 250-266.

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