By Anand Subbaraj, CEO of Zuper
Many field service businesses embraced a variety of workforces to keep their businesses running in the face of the pandemic. Many will continue to tap into different types of employees post-pandemic. The nuances of managing each type of workforce can be confusing. Here’s a guide to the three different workforce categories, common challenges you’ll encounter with each, and some tips to optimize your business in the face of these challenges.
There are three different workforce categories:
- Full-time, W-2 employees
- Contracted 1099 employees
- On demand gig workers
Field service businesses reach out to contract/gig workers when they need:
- A lower volume of people for high-skilled work
- A higher volume of people for low-skilled work
- Extra workers to help fill gaps during seasonal influxes
There are benefits and drawbacks to each, but fewer organizations are electing to hire only one category of employee, instead choosing to blend their workforce into a distribution that best fits their needs. With this in mind, here are some tips:
1. Onboard and Deploy Different Workforces Differently
Onboarding different workforces is going to look differently for each category. Onboarding 1099 independent contractors, for example, is generally much easier than onboarding regular W-2 employees. They’ll need to fill out a W-9 form with their name, address, and tax identification number. Obviously, 1099 MISC forms will be important come tax season, and you should understand the specifics such as the $600 minimum.
Beyond just basic paperwork differences, you’ll want to develop a collaboration strategy that’s tailored to each workforce. How will you highlight jobs and vet the right candidate for contract or gig workers? Is it first to sign up, or will you allocate jobs based on availability and geographic proximity? Consider Intelligent Dispatching to ensure the right person is at the right place with the right information at the right time, every time. This is actually a huge point, because you can greatly improve the customer experience by getting the closest employee to the job as quickly as possible.
2. Streamline Invoicing
Each workforce category will invoice differently, and you should be aware of how to handle this situation in a data-friendly way. In the case of W-2 workers, you will control the invoicing process internally. You want to minimize the back-and-forth and enable your customers to pay online in a secured manner. You should also explore converting estimates to invoices in a single click, so that all the information from the estimate is automatically populated in the invoice so as to remove redundant manual steps.
With contractors and gig workers, however, you don’t have the same control. Contractors set their own price and invoice your company for their services, while gig workers have a degree of control over their pricing, depending on the state in which they operate. For example, California’s AB-5 impacts pricing for gig workers. You should try to integrate these external invoices into your own internal invoicing system to streamline the process, so you don’t have to chase down payment or manage stacks of paperwork.
3. Create Better Business Process Workflows
Better workflows help you enforce consistent quality and process across the different categories of workforces. This begins with creating governance policies that keep in mind the different workforces you may be incorporating into your business. From here, you’ll need to standardize process flows across your different workforces to improve the quality of services rendered.
Consider defining the following:
- Important checklists for employees to consult on the job
- Service-Level Agreements (SLAs) between your company and customers that detail quality, availability, and responsibilities of your employees
- How notifications and alerts will be disseminated and how employees should react
4. Look to Generate Insights
Once you have your workflows in place, it’s important to understand performance across workforce categories. Develop KPIs that incorporate work orders, timesheets, and customer feedback so you get reliable insights into your operations.
This will enable you to monitor and boost your team’s performance and improve the customer service experience. Furthermore, if the data shows consistently negative performance from a specific type of workforce category, you can review how you onboard and train that category of employees or moderate how frequently you use it contextually.
5. Manage Liability Carefully
This is one of the biggest issues for service businesses that are managing a diverse workforce. If you’re working with a contractor, you’ll want to write your contract with them in such a way that minimizes your liability. You won’t be able to completely shift liability away from your business, but you can reduce risk for yourself.
You’ll want to have very clear policies in place, and you need to make sure the contractor understands and will respect them before they sign a contract with your business. In the case of contractor negligence, you can point to these policies to limit your liability exposure.
You’ll also need to ensure that your contractors have their own liability insurance. You can require that they carry two different types of insurance. The first is professional liability insurance. It covers errors and omissions on the part of the contractor. The second is general liability insurance. This covers accidents on the job that result in property damage or physical injuries.
The Workforce of the Future
Despite how overwhelming it can be to get started with onboarding contractors or gig workers; many service businesses are finding that they’re valuable additions to their organization. During the pandemic, we’ve learned the benefits of having a flexible workforce that can expand or contract based on demand. As you explore working with different workforces, you’ll need to understand the difference between each, how that could impact the customer experience, and the liability risks to which you will be exposed. Having the right technology that allows you to bring these new team members up to speed quickly and safely is critical to long-term success.