Look around your workplace today: how many of your fellow colleagues have been with the organization for less than five years? How many of them are only contracted to stay for five months?
And what about yourself? Are you employed as a full-time employee (FTE), or have you built a freelance or contract-based career for yourself thus far?
The fact is, freelance and contract workers now make up more of the workforce than ever before, and their numbers are growing.
In some industries, gig economy working is becoming the new normal.
This shift — together with the increase of full-time remote workers and shorter employee tenures — poses a new challenge for leaders, managers and HR personnel.
How should freelance and contract workers be managed? Their contracts are not the same as those of employees, but does that mean they should be treated any differently?
We’d argue: no.
Rather, there’s much to be gained from bringing your freelance and contract workers into the fold, and nurturing their personal and professional development in the very same way you would any other employee.
Let us explain why…
The changing face of the West’s workforce: flexibility is key
In the not-so-distant past, contracting was synonymous with ‘lack of security’ and, as a result, was not an appealing option for many workers.
Today, however, ‘flexibility’ is the word du jour; millions of individuals are flocking towards freelance and contract-based roles to find more adaptable ways of working to suit their changing needs.
Of the growing segment of workers applying for flexible roles, the majority are doing so in the hopes of finding work that better fits their schedules — working when they want, not necessarily for a 9-5 — or to amp up their income.
And the size of this segment is quite staggering.
According to Upwork, the world’s largest freelancer marketplace, 57.3 million US workers are now employed on a freelance basis — making up nearly 34% of America’s total workforce and contributing $715 billion to the country’s economy.
In Europe, “the gig economy" represents the fastest growing EU labor market as 8.9 million workers have taken the step from full-time work to freelancing or contract work.
As the flexible workforce increases in size, so too does demand for their services; in the US, more than twice as many freelancers have seen an increase in demand in the past 12 months than have seen a decrease: 32% versus 15%.
Corroborating this, a study from Intuit found that more than 80% of large corporations plan to substantially increase their use of a "flexible" workforce, predicting that "contingent" workers will exceed 40 percent of the U.S. workforce by 2020.
So, if the number of freelance and contract workers within our organizations is only going to increase, what does that mean for people and performance management?
Anecdotal evidence from those on the ground suggests that companies haven’t got the approach right, just yet.
Following a set of exposing interviews with ex-Google and Apple contractors, The Huffington Post coined the “purgatory of contract work” — where flexible workers are left on the outskirts of an organization’s culture, social scene and development opportunities.
How is it possible that two highly innovative and forward-thinking brands — both regulars in Glassdoor’s ‘best places to work’ shortlist — has come under fire in this way?
Excluding short-term or flexible employees from Christmas parties — as one Apple insider revealed to The Huffington Post; or not providing them with company t-shirts — as was found to happen at Google — may seem like arbitrary differences, but they can amount to a great deal.
Especially in Google’s case, where the number of contract workers is just shy of equal to full-time employees, at 97,300 contracted in, to 97,400 full-timers.
“You feel like there is this thing you should have access to. You are doing work for this company on-site full time, and it feels kind of arbitrary and kind of cruel in its execution. I wish they would see that they have the same responsibility to their vendors and contractors that they do to their full-time employees.” said Jaime, one of the ex-Google flexible workers interviewed for the exposé.
Ultimately, this kind of segregation can lead to disengagement, lack of motivation, a disjointed culture… any and all of which can negatively affect a company’s financial performance and reputation.
To foster an environment of collaboration, shared objectives, greater productivity, heightened morale and — indeed — healthier profit margins, it’s time to welcome flexible workers into the organization entirely, for however long they have been contracted to stay.
How your organization can build a better relationship with freelancers and contract workers
It should come as no surprise that freelancers prefer to work for employers who treat them like part of the team.
But armed with this insight — and learning from Google and Apple’s shortcomings — managers and leaders can reevaluate how they currently welcome, initiate, support, develop and eventually complete a project with freelancers or contract workers.
So does your organization’s approach feel up to scratch?
If you feel there’s room for improvement, here’s how you can — easily and immediately — start to better nurture your flexible workers.
Give them the tools they need to communicate freely and openly
Feeling on the outside of the conversation, either figuratively or literally, can be a significant cause of demotivation and disengagement from their role.
Providing freelance and contract workers with the same communication channels — a company email address, access to the Slack system, subscription to social agenda invitations, etc. – reminds them they are welcomed and valued members of the team.
Managers should also listen to flexible workers with open ears. A lot of the time, freelance and contract workers can see opportunities for improvement FTEs cannot; their fresh eyes and more varied employment background may bring interesting insights to the fore.
Should a flexible worker come to you with feedback: listen.
Better yet, invite all of your flexible workers into your company’s feedback channels and encourage them to engage.
You never know what you may learn…
Share the company’s wider strategic vision with every flexible worker
And on that point: maintaining an air of secrecy around your company ambition brings little benefit.
How can you expect a freelance or contract worker’s input to be meaningful and strategically-sound if they aren’t privy to an up-to-date business vision?
Not only does sharing your organization’s goals and objectives with flexible workers improve the quality of the work they do, it also increases the purpose and value they feel when they turn up to their desk every day.
Don’t overlook their development: help them achieve their goals
Aligning your team member’s objectives with the overall company vision helps empower your employees.
And that’s true of all employees, not just full-timers.
So as feedback loops shorten — occurring in real-time, rather than every 12 months — there’s every reason to include freelance and contract workers in frequent performance reviews and employee development strategies.
What’s more, as performance management goes digital, tools like Duuoo are allowing managers and team leaders to easily pick up on a new recruit’s performance path, feed into it in real time, and track development opportunities and achievements as they happen.
Professional development doesn’t need to be sluggish in 2019; your flexible workers deserve to have a place in your initiatives.
Make sure flexible workers feel valued
Having a feeling of purpose is just as important to flexible workers as it is to employees.
So who are your freelancers? What makes them tick? What do they care about, and how does this link to the work they do?
Where possible, really get to know contingent team members in the time you have with them. You should value them as an individual, not just the work they are doing.
Remember: no matter how short their contract with you, they are much more than just a temporary cog in your corporate machine.
And making them feel valued will benefit your organization in the long-run; you’ll develop a stellar reputation, which in turn will make recruiting talent easier and support your bottom line.
Taking these learnings to improve your relationship with full-time employees — especially those who opt to work remotely
On the whole, employee tenure is getting shorter.
Where once an organization could have expected a full-time employee to stay with them for years — if not decades — now the average turnover rate is closer to 2 years in most industries.
To add to this: remote working is on the increase; 80-90% of the workforce would like to work remotely, at least part of the time.
This represents a dramatic change in culture, where suddenly the vast majority of your team will have fewer face-to-face contact hours than before.
So what insights from managing freelance and contract workers can we carry over to our nurturing of employees?
Indeed, flexibility is a motivator for many workers, regardless of their contract-type.
Remote working is one articulation of this flexibility, but so too is the personal and professional development you offer full-time employees.
Offer FTEs more ownership over the projects they want to work on — and thus the experience and skills they wish to advance — to build flexibility into their everyday work life. Then, support their development mission with shorter review cycles, iterative goal setting and frequent touch points throughout the year.
Duuoo’s continuous performance management platform can help you achieve all of this, and more — bringing managers closer to FTEs, freelancers and contract workers.
Happier, more productive working environments and more successful, mutually-supportive teams.
Get in touch to find out more.