Executive Briefings

How to Manage Risks in the Gig Economy

With companies making more and more use of non-permanent staff, procurement must collaborate to mitigate the risk.

Do you know your RPO from your MSP? You're going to have to soon enough, as the recruitment process outsourcing market (that's RPO, which encompasses 'Managed Service Programs', or MSP) is growing at three times the rate of traditional staffing.

Thanks to this spike in demand, procurement will find itself working more closely with HR to ensure organizations are getting the most value from recruitment services, says Matthew Dickason, global managing director of Hays Talent Solutions, a provider of such services. While HR traditionally owns RPO (usually bringing in permanent employees) and procurement looks after MSP (typically contractors), lines are blurring as staffing models evolve. “We’re seeing more of an interest in bringing it all together into a ‘total workforce management’ approach,” Dickason explains.

The growth in demand for flexible staffing models is due to both supply and demand. On the supply side, many potential employees want to work more flexibly, especially millennials and those working in technology, Dickason says. From the employer perspective, flexible labor pools allow organizations to bring in talent as and when they need it, and bring tax savings. Self-employment is booming in the UK, growing from 3.8m people in 2008 to 4.6m in 2015.

However, the growth in use of contractors, temps and freelancers brings with it risk and complexity. The number of employment suits on the legalities of the ‘gig economy’ is growing. Recent high-profile examples include a case brought by Uber drivers, in which the court ruled the drivers must be classed as ‘workers’ and, therefore, merit more employment rights, rather than self-employed contractors. Uber is appealing the decision.

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Do you know your RPO from your MSP? You're going to have to soon enough, as the recruitment process outsourcing market (that's RPO, which encompasses 'Managed Service Programs', or MSP) is growing at three times the rate of traditional staffing.

Thanks to this spike in demand, procurement will find itself working more closely with HR to ensure organizations are getting the most value from recruitment services, says Matthew Dickason, global managing director of Hays Talent Solutions, a provider of such services. While HR traditionally owns RPO (usually bringing in permanent employees) and procurement looks after MSP (typically contractors), lines are blurring as staffing models evolve. “We’re seeing more of an interest in bringing it all together into a ‘total workforce management’ approach,” Dickason explains.

The growth in demand for flexible staffing models is due to both supply and demand. On the supply side, many potential employees want to work more flexibly, especially millennials and those working in technology, Dickason says. From the employer perspective, flexible labor pools allow organizations to bring in talent as and when they need it, and bring tax savings. Self-employment is booming in the UK, growing from 3.8m people in 2008 to 4.6m in 2015.

However, the growth in use of contractors, temps and freelancers brings with it risk and complexity. The number of employment suits on the legalities of the ‘gig economy’ is growing. Recent high-profile examples include a case brought by Uber drivers, in which the court ruled the drivers must be classed as ‘workers’ and, therefore, merit more employment rights, rather than self-employed contractors. Uber is appealing the decision.

Read Full Article