The U.S. labor market is in a unique position we haven’t quite seen before. As inflation in the U.S. is at its highest levels in 40 years, unemployment, conversely, has seen its lowest levels in the past two decades. We have seen a tremendous shift among business executives to now heavily incorporating the use of the contingent workforce.
With over 80% of large U.S. corporations planning to increase the use of a flexible workforce in the coming years, it is important for organizations to save on cost amid recessionary concerns. Here are three strategies your organization can leverage to drive cost savings while maintaining a resilient workforce:
1. Leverage an Employer of Record Provider
Over the past 30 years, the demand for payrolling services has grown with changing business requirements, globalization of the workforce, and the passage of new regulations. In an increasingly complex regulatory landscape, many organizations have turned to an Employer of Record (EOR) provider to assume the responsibility of payroll, risk, and compliance.
Magnit pioneered and launched the industry’s first professional payrolling service and has since iterated on our services to now provide unparalleled EOR solutions. Backed by the industry’s first on-demand pay offering, organizations can save approximately 20% on every engagement that is filled with a referred worker vs. an agency sourced worker. This is driven in part by Magnit’s pure vendor neutrality, which means that we do not have an affiliation with any staffing company, allowing us to solely focus on payrolling most cost-effectively.
2. Ensure Full Compliance When Engaging the Contingent Workforce
When leveraging the contingent workforce across business operations, organizations must properly classify workers and contractors. Possible fines for failure to properly classify employees can range from IRS fines and assessments to liability for unpaid overtime, even state-specific sanctions. With so much in flux, it is important to consider how your organization will prioritize the classification of its extended workforce. In order to save on costs and mitigate risk, companies should consider partnering with a third-party provider to outsource compliance screening. Magnit’s Employer of Record services not only provide best-in-class payrolling capabilities but also offer white-glove risk and compliance services that help with IC Contractor Classification and payrolling services when needed. With Magnit EOR, clients can achieve 100% compliance across international regions in addition to 24/7 audit support.
3. Enhance Your Employee Experience
It is imperative to understand today’s labor market is a candidate’s market, so to help avoid large waves of employee turnover and unrest, many organizations have begun to invest more priority into their employee experience. A large contributing factor to improving employee experience rests upon the level of your organization’s DE&I involvement, with a Glassdoor study reporting 67% of job seekers say that a diverse workforce is important when they evaluate job offers. This holds true for not only the full-time workforce but also the contingent workforce. In addition to providing the industry’s best-in-class benefits packages, Magnit also offers the industry’s only comprehensive DE&I solution for the contingent workforce. Comprehensive of Employee Resource Groups and dedicated DE&I education and training, Magnit has recognized the need to enhance the employee experience through total talent management. (Download our Inclusive Hiring Practices Checklist.)
Conclusion – Consider Magnit EOR to Drive Cost Savings While Attracting & Retaining Top Talent
As organizations struggle to balance saving money while delivering ROI, more are leveraging a flexible workforce. If your organization plans to incorporate the use of the extended workforce, it is important your company is working with a team that can fit your specific business requirements. Magnit’s Employer of Record solution not only enables clients to drive cost savings but also helps clients achieve compliance and promote an enhanced contractor experience. Coupled with the industry’s first on-demand pay solution and a best-in-class benefits package, and additional brand marketing, Magnit helps organizations not only attract but retain their high-caliber talent.
If you’re interested in learning more about how Magnit is helping organizations implement winning contingent workforce programs globally, please contact a Magnit representative at firstname.lastname@example.org.
Disclaimer: The content in this blog post is for informational purposes only and cannot be construed as specific legal advice or as a substitute for legal advice. The blog post reflects the opinion of Magnit and is not to be construed as legal solutions and positions. Contact an attorney for specific advice and guidance for specific issues or questions.