Page 14 - MetalForming January 2013

Human Capital
By Debbie McGrath
Managing the Risks of Contingent Labor
Posted to HR.com by Michael Kirsten, thought leadership and content mar- keting, Kelly Services, Inc. Global companies are relying
more heavily on contingent
workers to control rising labor costs, bridge skills gaps and respond to fast-moving market conditions with greater agility. According to a 2012 Aberdeen Group survey, the average company’s workforce comprises 26 per- cent contingent workers. Experts spec- ulate that for some global companies, the contingent workforce may repre- sent an even higher percentage of the total workforce than traditional employees.
Yet, as companies increase their dependence on outsourcing and third- party labor, organizational limitations come into plain view. Internal process- es and systems typically are not ade- quate to manage the inherent risks of a contingent labor force, not to mention extract maximum value from this resource.
Among the most common conse- quences of being ill-equipped to man- age contingent labor:
• Regulatory and compliance risks. Multinationals have difficulty tracking third-party labor through a single ‘choke-point,’ and unwittingly take on
Content for Human Capi- tal comes courtesy of Debbie McGrath, founder and chief instigator of HR.com, Aurora, Ontario, Canada. McGrath has a degree in computer sci- ence and business administration from the University of Guelph. Founded in August 1999,
HR.com aims to help build great companies by connecting them with the knowledge and resources they need to effectively manage the people side of business.
www.HR.com
tel: 877/472-6648
high levels of compliance-related risk. A company that misclassifies workers may be subject to audits and penal- ties, which vary country-by-country.
• There appears to be growing inter- est in the United States to further reg- ulate this area, based on a proposed bill to amend the Fair Labor Standards, as well as newly published rules on work- er classification.
• Access and security. Many com- panies typically impose less-stringent security standards on contingent labor than on employed labor. A 2011 survey by HireRight found that only 48 per- cent of companies that use contin-
Internal processes and systems typically are not adequate to manage the inherent risks of a contingent labor force.
gent labor conduct background checks on those workers. Further, only 22 percent conducted drug testing during the onboarding process, and just seven percent maintained ongoing drug testing.
• Visibility/analytics. Many compa- nies cannot assess the amount of third- party labor supporting them, where those individuals are located (geo- graphically and by job category) and what they have access to.
• Technology. Without an integrated solution to manage vendors and ‘on- board’ workers, and to track spending, organizations are ill-equipped to make the strategic decisions necessary to deploy contingent labor efficiently and safely.
The commitment among global organizations to solve the problem is growing. Forty-one percent of compa-
nies surveyed by Aberdeen Group believe they face increasing risk related to managing contingent labor. And, 56 percent reported that their top priority was to improve visibility into all facets of contingent workforce management.
Rethink Recognition: Do You Trust Your Employees?
Posted to HR.com by Derek Irvine, vice president, Globoforce
Recognize this: Peer-to-peer employ- ee recognition does not equal zero- value awards. During the last few years, I’ve noticed that a growing number of human-resource professionals and employee-recognition program man- agers are equating peer-to-peer recog- nition with zero-value awards. In other words, employees are able to praise, appreciate and recognize each other through formal systems, but not assign any economic value to those awards.
Structuring a peer-to-peer program in this way communicates three mes- sages to employees:
1) We want employees to notice the good work of their colleagues.
We get it. We understand the impor- tance of employees noticing and appre- ciating each other’s efforts and achieve- ments. So please, pay attention to what your colleagues are doing and thank them for it.
While this is all good and appropri- ate, use this attitude as a strong starting point for a truly strategic and social recognition program that can change and drive your culture.
2) But we don’t trust you to give appropriate levels of recognition with economic value.
We want you to notice good behav- iors, actions and achievements, but putting any skin in the game... well,
12 MetalForming/January 2013
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