People Practice » How to streamline management of freelance contracts for financial benefits

In today’s global economy, freelancers and contractors play a vital role in helping businesses to deliver their product or service, with many companies choosing to hire from a pool of talented freelancers to bolster their workforce rather than take on permanent employees.

Figures for the UK alone show that there are an estimated two million freelancers contributing some £271 billion each year and that freelancers now represent six per cent of the UK workforce. This growing ‘gig economy’ represents a significant shift in the structure of the workforce and whilst it allows flexibility to manage busy periods and make specialist hires, the red tape and the issue of compliance with changing legislation is proving to be a real headache. One of the biggest negative impacts, is the increasing amount of time required to manage freelance contracts by the internal team.

In total, it’s estimated that the self-employed market contributes £275 billion to the UK economy. The ONS reports that the number of self-employed workers has increased from 3.3 million in 2001 to 4.8 million in 2017 accounting for 15% of the U.K workforce. This growing ‘gig economy’ represents a significant shift in the structure of the workforce and whilst it allows flexibility to manage busy periods and make specialist hires, the red tape and the issue of compliance with changing legislation proves to be a real headache.

Permanent employees need to stay up to date with onboarding freelancers, protecting their data, paying their invoices and creating reports. This is time heavy and therefore costs businesses a lot of money, so in this ‘gig economy’ it is more important than ever to make working with freelancers as effective and streamlined as possible.

By automating paperwork and picking the right online management service to manage this, like Flime.com businesses can streamline the process giving employees more time to concentrate on what they do best – focus on delivering their job. Here’s three ways automated services can help….

  1. Save time

The various steps required for onboarding a new freelancer may not seem significant, but the tasks add up. They can be cumbersome for both the employer and the freelancers. What should be an easy process encounters barriers and also delays employees from their core work. Simple issues such as, not having the right details in the contract, scanning or taking a photo of identification, finding and storing social security numbers and filling in your bank account details may be repeated every time a new contract starts.

Instead, with an automated service, inbuilt functions result in no repetition and most importantly without employers or freelancers giving the process a second thought.

In addition, onboarding can be done before the first working day. Freelancers have all the necessary steps completed in advance and can start working on the projects for the time they are paid for.

  1. Keep data secure

It is no secret or surprise that GDPR comes with a lot of paperwork and since its introduction, it has had a major impact on the way businesses operate. Many larger companies have employed a Data Protection Officer (DPO) to write policies, conduct audits and manage how data is handled. For smaller companies, hiring a DPO may not be feasible and the responsibility is shared among employees, but this, in turn, takes them away from the work they were initially hired to do.

Choosing a freelance management system that takes care of GDPR as part of its core business means that companies no longer have to worry about being compliant or dedicate time and money to the process such as data capture and protection. Having a third party take care of GDPR also reduces the risk of information being leaked or shared between employees. This saves designated DPO employees’ efforts from making sure that all the data is securely contained and regulated within the company.

  1. Manage invoices and save money

Using a freelance management service creates a centralised company-wide approach to managing and hiring freelancers. This allows companies to track exactly how much is being spent and on what, resulting in more accurate evaluation of budget spent on freelancers.

Cash flows can also become a headache as you have to decide on how much to pay freelancers then allocate the money. There can be scenarios involving refunds and paybacks which can get difficult to manage. With Flime, companies add the funds they have decided to spend onto the platform directly and once they have approved the work handed in by the freelancer, they can send the money with just one-click. Paying at scale is also possible via API, this can save a lot of effort to finance department employees.

Savings can be significant when you deploy automation software for a business and return on investment can be rapid. Numbers, of course, will vary with each situation, but well thought-out automation is one of the smartest ways to increase productivity and lower costs. With great deals on payment, wire transfers, privacy, security, and reporting system will save your company money that it would instead be spent on employees that have been hired to do a different job.

There is no doubt that the ‘gig economy’ is flourishing in the UK, and as it continues to grow, so do the opportunities it presents. Businesses who work effectively with freelancers can benefit from the changing workforce, and by implementing workflows and systems that streamline that process will further reap the benefits.