The contingent workforce is becoming an increasingly important part of human capital strategies among financial institutions. These “non-employees” have different rights and responsibilities—in large part, driven by regulatory requirements—and they present different risks to the companies that use them, too. For many financial institutions, it’s time to define, or enhance, their contingent workforce strategy.
In financial services, the business demand for contingent workers is growing, thanks to changes in the geopolitical landscape and the rise of the “gig economy.” Technology has led financial institutions to rethink employment strategies, and this has workforce implications. The logic is unassailable: financial institutions want to be able to scale their teams, deploying a wide range of skill sets, but only as necessary. And contingent workers can help address both rising demand for certain skills and the need to lower costs.
Here are four areas where financial institutions often struggle to manage risks associated with contingent workers:
We encourage you to look at your contingent workforce across five fundamental facets, which build on our contingent workforce management framework: tangible commitment, organization, policies and procedures, governance, and technology and data, as shown to the right.
Contingent labor offers an intriguing mix of opportunities and challenges. There is no magic bullet for managing these workers, and every financial institution will want to determine the strategy that makes the most sense for its unique circumstances. But it’s clear that if you approach this with a unified strategy, accounting for how the market is changing, you’ll manage your risks more effectively. And while your contingent workers may be here today and gone tomorrow, the value you get out of your program is likely to stick around for a lot longer.