How Employment of Contingent Employees Affect Organization’s Business, its HRM responsibilities, Overall Costs, and Organizational Culture

Contingent workers refers to consultants, independent contractors, freelancers or other non-permanent and outsourced workers that are hired based on projects. These workers can operate remotely or on site based on the specific task they are required to carry. These workers are very skilled experts in their area of specialization. Contingent employment according to Hipple and Stewart (1996) is differentiated from standard employment based on two main characteristics. Contingent work indicates that the relationship of employment is conditional on some other aspects that include time, and it denotes absence of attachment between the employer and the worker, such as the worker being paid by separate agency other than where she or he works. Contingent workers are normally preferred since they increase flexibility which these employees offer to companies, the altering workers preferences for extra flexible schedules, alterations in the legal setting, and marketing by temporary industry of help agency. Their exceptional skills help in increasing work efficiency and helping an organization to handle specific business demands that can only be handled by specialist in a more resourceful.

Read also Should the Compensation of Contingent Workers be the same as Conventional, Full-Time Employees doing Same Work?

Contingent workers are normally preferred since they normally demand less compensation and benefits compared to non-contingent workers. Most of contingent workers are said to be young people who do not high pay. In addition, contingent workers do not demand for extra benefits that include health insurance, retirement benefits, paid holidays, sick leaves, and parental leaves among others (Pedulla, 2013). The company thus get to save a lot of money since they only hire contingent when their project demand an extra skills that is not found in the company and that only necessary as long as the project last. This assist in reducing human resource management cost. Outsourced works also focus on ensuring good work performance to create opportunities for future business with the hiring organization. Thus the organization HRM does not need to employ extra effort to enhance good performance. Contingent workers mostly work based on a certain agreement which they must fulfill to avoid litigation and also to ensure marketing of their services and skills for future business expansion. Thus, the HRM of the hiring organization does not incur extra cost or time loss in trying to enhance individual workers performance. 

Hiring contingent workers eliminates the workers retention cost which is mostly characterized by the need to pay huge benefits. Moreover the general pay demand for the contractual workers is said to be considerably low than non-contingent workers and hence, the organization get to save a lot in workers payment expenses, than when it depend purely on non-contingent workers. While choosing the right contingent workers, the organization get the chance to do window shopping and a chance to select an employee or agency that offers quality services at a reduced cost. This gives the company a chance to cut employment cost and to have their work completed by a specialist who could have been very expensive to maintain in case non-contingent of such specialty was to be considered.Hiring contingent workers erodes the organization culture. In most cases, workers get to adopt the organization culture by learning norms, routines and procedure, to a point of making them a habit. This cannot be achieved in contingent employment since these workers do not stick long enough to embrace the organization culture.

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