In a world where remote work and contract-based employment is becoming a well-accepted norm, employers are facing challenges integrating their benefits, payroll and HR systems to manage the diverse workforce.
More and more companies are using contingent labor, says Colin Brennan, a global workday deployment leader with Aon Hewitt. But one of the lingering questions when hiring contractors, he says, is whether these employees should be owned by HR or by the third party?
Also see: “Benefit considerations and the contingent workforce.”
Ninety-five percent of organizations consider a flexible workforce vital to overall business success and growth according to recent research, says Arun Srinivasan, SVP of strategy and customer operations at Fieldglass, a vendor management system provider and SAP company. “This workplace trend demands that employers engage employees and external workers via a unified total talent management strategy,” he says. “Doing so will enable full visibility into how a company gets work done, so it can better align present and future business needs with the right resources, and achieve better business results.”
Earlier this week, SAP announced its own integration of SuccessFactors, its human resources software, with Fieldglass to offer employers a service that takes a more holistic look at their different workforces.
“Today’s workforce is more blended than ever before,” says Christopher J. Dwyer, research director with Ardent Partners, a research and advisory firm. “Nearly 35% of the total global workforce is comprised of non-employee talent, with that figure expected to grow steadily in the years ahead. As such, it is critical for businesses to develop total workforce management programs that can effectively manage all enterprise talent under a single, centralized banner of systems and capabilities.”
Where it can become an issue, says Aon Hewitt’s Brennan, is when employees move from contract to full time employment. Seemingly simple things like employee ID numbers can sometimes get tricky when different systems communicate with each other.
There is also an interesting debate, he says, between the blurring lines between contractors and employees. “If you start to pull them into a talent management [system] and employ them for two years on end, at what point do they become an employee?” he says.
“Talent is the most important factor in determining the success or failure of a company, and it doesn’t reside only in the traditional employee base,” says Mike Ettling, president of SuccessFactors. “Contingent labor has risen greatly in importance over the last few years, and external workers will continue to impact the world of work.”
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