If your company isn’t already working with a contractor, then it might be hiring one soon. Gallup reports that today, about 35% of all US workers are somehow involved in the gig economy. But many companies struggle to maintain strong working relationships with their contractors. Granted, it’s difficult to maintain a close-knit work environment right now while most employees are working remotely. However, gig workers are a critical component to the success of any business.
It’s worth spending the time to understand what they need. Investing in your contractor relationships today can deliver huge payoffs down the line. When you have a tight deadline or need a referral for a contract, your contractor will only perform as well as you have treated them in the past. Here are four ways that you can strengthen your contractor relationships today.
#1 - Include Them in Team Invitations
Of course, your contractors are not obligated to show up for most meetings or team-building exercises, but it’s always nice to be invited. Contractors often have more than one client at a time. Your company is probably not their only priority. If you want to strengthen your relationship with your contractor, invite them to company get-togethers. Let them know that it’s totally optional and you don’t expect them to set aside the time. However, express the desire to include them in the team.
Showing a little interest in them can go a long way in maintaining a good working relationship. You might discover fun new facts about your contractor. This is a good way to help contractors feel more invested in the team, and it typically results in better work. If your company is working remotely, you can extend an invitation to a virtual happy hour or invite them to your Slack channel. Otherwise, simply invite them to share more about their other clients or home life. Many contractors get lonely and don’t have the benefit of watercooler chats with co-workers. Extend some generosity to your contractors and make them feel like real human beings.
#2 - Give Feedback
Regular full-time employees typically benefit from a built-in feedback system. The HR department schedules meetings for each employee every six months and they review their performance in a conversation with their manager. But many contractors don’t have the opportunity to receive regular feedback from their employers.
As a result, a lot of contractors are hungry for feedback. They want to know if they are satisfying their clients, and most are happy to get feedback about what they could be doing better. This feedback could include quality of work, timeliness of work, and communication style. Keep in mind that it’s always a good idea to sprinkle positive praise in with any negative feedback. This is especially true with contractors who don’t have the benefit of long-term company knowledge like salaried employees do. Companies can take advantage of this opportunity to engage in meaningful conversations with their contractors. It’s even possible that contractors could achieve higher standards of work simply because there is a higher expectation for feedback in a contractor relationship. Let this inform your internal processes around feedback for salaried employees, too.
#3 - Understand Their Financial Situation
There is a difference between freelancers and contractors. Make sure you know which one you’ve hired as this affects how you interact with them and how you pay them. It could also affect your company’s bottom line. For instance, a freelancer pays her own taxes, works her own hours, and receives no benefits from the companies she works for. She typically has more than one client at once and doesn’t usually have employees, but might occasionally outsource work.
A contractor, on the other hand, typically works on a single large project at a time. Contractors may occasionally work from the client’s office when a site visit or skill-specific task is required. Most freelancers only work remotely. There is some overlap in the two types, yes. But it’s a good idea for companies to understand which type of person they wish to hire. If you need someone to provide 10 hours a week of remote support, then you’re probably looking for a freelancer. But if you want someone to take on a three-month contract on a relatively full-time basis, then you’re looking for a contractor.
#4 - Reliable Invoicing by Outsourcing
Finally, nothing can sour a contractor relationship like delayed payments. Even if the delay is simply due to the normal processing time of your in-house invoicing software, contractors get antsy when they don’t receive payment regularly. This is unfortunately rooted in real stories about companies that undercut their contractors and take six months to compensate them. That’s just not a sustainable way to build relationships with contractors.
Instead, strengthen your relationship with contractors by outsourcing your accounting needs. An outside company with cutting-edge financial tools could provide faster, more reliable invoicing for both your employees and your contractors. If your accounting team struggles to incorporate contractor payments into their regular workflow, this is a definite sign that you need to outsource it. Don’t let disorganized or inefficient in-house accountants repel a great contractor. Plus, outsourcing could actually save your company money in the long run by reducing overhead.
In the end, the most important thing for you to know is that contractors aren’t going anywhere. The gig economy is growing and will only continue to grow. In fact, if the gig economy keeps up its current growth rate, more than half of the entire US workforce will be gig workers by the year 2027. That being said, it is crucial that your company take the time now to figure out its contractor management philosophy.
Gig workers are a valuable part of the business ecosystem and they deserve to be paid on time and treated like part of the team. Put these four tips into practice and you’ll see your contractor relationships blossom. If you want help with outsourcing your invoicing to better support your contractors, chat with us about your options.