Talent Management Content

Procurement pros rise to the occasion at Big Ideas Summit Chicago

When the city of big shoulders hosted the Big Ideas Summit last week, the procurement executives at Procurious’ event in Chicago generated a lot of excitement and a powerful list of insights.

An array of speakers led thought-provoking sessions and imparted plenty of big ideas — from the latest in neuroscience to how procurement technology and policies affect issues like human trafficking and forced labor in supply chains.

CA Assembly Bill 5 is Law: Is the gig economy doomed? (Part 3) [PRO]

sharing economy

Last week, with a stroke of California Gov. Gavin Newsom’s pen, CA Assembly Bill 5 (AB-5) became law and cast the gig economy into question. Did it doom the gig economy and its contract workers? And what does it mean for businesses?

Technically the law takes effect Jan. 1, but its future, nonetheless, remains uncertain for many reasons. And even if the law does not get watered down or blocked in the courts or overturned by state referendum, the jury is still out on whether AB-5 will deal a death blow to the gig economy or just change it. The signing of AB-5 “into law,” to a significant degree, marks the start of a new phase of debate and uncertainty about the question of whether a worker is an employee (EE) or an independent contractor (IC) and what the future of the “gig economy” — an ambiguous term if ever there was one — will be.

Earlier in this series, we referred to the gig economy as “an ecosystem of businesses and many types of workers” and governed by laws — “that part of the labor market where businesses, including online ‘gig platforms,’ engage workers as non-employees.” We believe this is the broader context in which this law should be analyzed (because, believe it or not, it’s not just “all about” Uber, et al, which represent just one segment of workers classified as ICs. According to our estimates, based in part on Beacon Economics report, “Understanding California’s Dynamex Decision 2018,” ICs make up about 19% of the California employed workforce of about 20 million workers (upwards toward 4 million ICs in the state). And over 90% are in industry segments other than “transportation.”

In Part 3 of this three-part Spend Matters PRO series, we will try to assume the business perspective and provide our thoughts on the newly passed law and the fate of the gig economy as well as point to potential implications for contingent workforce managers, HR and other executives.

CA Assembly Bill 5 passes: Is the gig economy doomed? (Part 2) [PRO]

workers

Last week, in Part 1 of this Spend Matters PRO series, we covered the controversial California Assembly Bill 5 (AB-5) that changes the definition of who is an employee and who is a contractor — sending shockwaves through the ecosystem of businesses and workers that constitute the so-called gig economy (that part of the labor market where businesses, including online gig platforms like Uber, engage workers as non-employees). Though California Gov. Gavin Newsom signed the bill into law this week and it is slated to take effect January 2020, the future is still uncertain, and the controversy still rages.

Gig-platform companies providing ride, delivery and other services have been in the cross hairs of the bill, and they have already spent over $15 million attempting to challenge, influence and obtain an exemption from the law. Uber has suggested it will defy AB-5. And Uber, Lyft and DoorDash may fund a statewide referendum to cost upwards of $90 million. Court challenges will also come from many businesses and other organizations that do not support the law.

The fundamental issue at stake is how workers get classified by the state as either an employee (EE) or independent contractor (IC). AB-5 defines just that in very specific terms; and some people (mainly workers) are happy about that, and others (mainly businesses) are not (see Part 1 for more details on the law and its exemptions). Indeed, the stakes can be very high for businesses that rely on ICs (or who they thought were IC). But that’s just one side of the story — new laws and regulations that may cut into profits or even destroy some gig economy business models. There are other perspectives as well, such as workers and government, to name two.

In Part 2 of the series, we examine the competing interests and perspectives around AB-5. In Part 3, we will provide our own thoughts on the bill as well as point to potential implications for contingent workforce managers, HR and other executives.

New name for SolutionMap category: Direct Sourcing of Workforce/Services (DSW/S)

As of Q3 2019, the CW/S SolutionMap category “Independent Contract Workers” will be renamed “Direct Sourcing of Workforce/Services” (DSW/S) to better represent the diversity of solutions that Spend Matters has covered to date and those we will cover in the future.

In addition to the name change, we have broadened the SolutionMap definition, in part, because the solution category has expanded beyond the concept of the original “freelancer management systems” (FMS) to include providers addressing a much broader range of use cases.

Check back in with Spend Matters tomorrow for the Q3 2019 SolutionMap release, which will include the latest rankings of Direct Sourcing of Workforce/Services solution providers.

CA Assembly Bill 5 passes: Is the gig economy doomed? (Part 1) [PRO]

California Assembly Bill 5 (AB-5), recently passed by the state Senate, changes the definition of who is an employee and who is a contractor. It is expected to be signed by the governor and is slated to go into effect January 2020. The new legislation, which codifies the 2018 state Supreme Court decision in the controversial Dynamex civil litigation case and clarifies its application, is sending shockwaves through the ecosystem of businesses and workers that constitute the so-called gig economy (that part of the labor market where businesses, including online gig platforms like Uber, engage workers as non-employees).

The main issue, one that has become increasingly fraught over the years, is whether a worker should be classified as either an independent contractor (IC) or an employee (EE) of a business, given the conditions and characteristics of the engagement. Anyone who follows this matter knows that determining the classification of a worker is not a simple matter. The presence (or absence) of laws and interpretations at the national, state and even municipal levels and the promulgated regulations of different governmental entities responsible for taxation, unemployment compensation, worker’s compensation insurance, etc. means a worker may be classified differently depending upon the reference point.

In Part 1 of this three-part Spend Matters PRO series, we will cover the background/context of AB-5 and the essential points of the bill. In Part 2, we will examine different perspectives about the law, and Part 3 will provide our own thoughts and examine some potential implications for contingent workforce managers.

VectorVMS: Vendor Introduction, Analysis and SWOT [PRO]

This Spend Matters PRO Vendor Introduction offers a candid take on VectorVMS and its capabilities that help companies with their contingent workforce programs. The brief includes an overview of VectorVMS and its solution offerings, a summary solution evaluation, a SWOT analysis and, lastly, a selection checklist for companies that might consider the provider.

GEP: Vendor Snapshot (Part 5) — Solution Weaknesses [PRO]

In Spend Matters’ previous installment of our seven-part GEP review, we called out some of the real strengths of the SMART by GEP platform, including some that are rare in the market today. In this Part 5, we are going to balance our analysis by also pointing out some of the "weaknesses" of the platform, at least against peers. (A weakness isn't a weakness unless you are looking for, or need, a certain capability, which, of course, you may already have in-house in another platform.)

While we may have hinted at these by way of omission of coverage in our solution overview in Part 3 and Part 4, we are going to get more specific so you understand precisely what isn't there (and can make a judgment call as to whether you even need the capability). We’ll look at deep optimization (especially logistics), asset management for direct, VMS, trade financing, T&E and more.

The Contingent Workforce and Services (CW/S) Insider’s Hot List: September 2019 [Plus+]

Welcome to the September 2019 edition of Spend Matters Insider’s Hot List, a monthly look at the contingent workforce and services (CW/S) space that’s available to PLUS and PRO subscribers. For those new to the Hot List, each edition covers the prior month’s important or interesting technology and innovation developments in the CW/S space.

We’ll look at several hot topics: Upwork’s review of disagreements about the size of the freelance economy, changes in worker classification, drone deliveries, a funding round by healthcare jobs marketplace provider Nomad Health, and how freelancers are changing banking and finance.

How to hire contingent workers around the globe — and stay in compliance

contingent-workforce

The world is getting smaller every day, helped along by technologies that allow us to connect to people, activities and companies around the globe. Businesses are able to incorporate workers from anywhere, sometimes as seamlessly as if they were next door. While communicating with workers may be simpler, engaging them for work can be a complicated matter.

Many companies are adopting a flexible approach to the way they want to source, engage and manage their contingent workforces domestically in the U.S. and across the globe. However, those same companies often struggle to deal with the complicated issues surrounding worker classification, including vetting and compliance for a global contingent workforce.

To find out how companies can successfully navigate these tricky issues, we spoke with John Smith, managing director, Americas, at CXC Global.

Shortlist: Vendor Introduction — Analysis, SWOT, Selection Checklist [PRO]

This Spend Matters PRO research brief provides an introduction to Shortlist, which describes itself as an FMS (freelancer management system) or, alternatively, a software-as-a-service platform for businesses to engage, on-board, manage and pay independent/freelancers. Shortlist was covered in the Spend Matters SolutionMap for software solutions that enable businesses to manage their direct-sourced, independent contract workforce (where it was designated as a Solution Leader, the upper right quadrant for having high scores for capabilities and high customer scores, for all four buyer personas).

FMS solutions began to emerge about eight years ago, when the rise of the gig economy called attention to the lack of solutions designed to enable organizations to engage and manage their independent/freelance workers. Vendor management systems (VMS) solutions did not provide fit-for-purpose solutions; and many companies managed with spreadsheets, other kludged systems or nothing at all. In any case, it became increasingly clear that organizations of all sizes had neither adequate visibility into their independent/freelance workers nor the tools to manage and fully leverage that population of talent.

Over the past eight years, various solutions emerged to attempt to address these requirements. Today they now number on the order of 20 providers, depending on how the category is delimited, based in North America and elsewhere. These solutions have taken a variety of forms, often going beyond the classical definition of FMS[1]. Some arose in tandem with their proprietary, pre-populated online freelancer marketplaces (e.g., Upwork). Some were geared to enable mobile field contractors/gig workers (e.g., FieldNation, WorkMarket). Some, including Shortlist, began supporting small-scale service providers (like boutique creative agencies, small specialized consulting firms) in addition to individual independent/freelance workers.

In this Vendor Introduction, we will zero in on Shortlist and provide an overall understanding of the company and the solution. The brief includes a summary assessment of features and functions, a SWOT analysis as well as a selection checklist for companies that might be considering Shortlist. In this brief, we will abbreviate individual independent/contract/ freelance workers as ICWs and small-scale service providers as SSPs (collectively, we refer to them as “providers”).

VMSA West — A Breath of Fresh Air for Contingent Workforce Conferences

This week, on Aug. 14 and 15, I had the opportunity to attend the VMSA West conference held right on the coast in beautiful Half Moon Bay, California. This was the first conference on the West Coast for VMSA, which wanted to create a contingent workforce event more accessible to businesses on this side of the country (the annual flagship conference VMSA Live is held annually in Florida). About 130 ecosystem professionals (a balanced mix of buy-side, MSP, supplier and other providers) met in an intimate setting to breathe, explore topics and learn from one another.

Upwork Enterprise’s customer reviews are in the new SolutionMap Customer Insights report

This week’s SolutionMap Customer Insights report focuses on customer reviews for Upwork Enterprise, the solution provided by the global online freelancer marketplace. It combines technology and managed services to enable enterprises to source and engage freelance talent. The applicable SolutionMap category for this report is in Independent Contract Workers. SolutionMap Insider members can read about Upwork Enterprise's reviews in our latest report.

In each Customer Insights report, we provide a one-page summary of information from the SolutionMap peer review process. It includes ratings on how well the vendor meets user expectations, three key differentiators for the vendor and a list of quotes about the vendor’s greatest strengths.