Welcome to the third article in a five-part series that will focus on how procurement, finance, and other professionals effectively build a “compliance management” checklist that addresses multiple avenues of spend management and the compliance ramifications behind strategic spend categories. The first four articles will highlight the dozen items that should be included in an enterprise’s procurement compliance checklist, which span across supply management, risk management, and complex spend management, while the fifth and final article in the series will detail how collaboration plays a vital role in both building this checklist and amending it when the need arises.
The contingent workforce management content of CPO Rising, Payables Place’s sister site, is typically aligned to the evolution of the space and the non-traditional workforce’s impact on the greater enterprise. The word “evolution” is thrown around quite frequently when discussing this industry, and rightfully so: this complex category has elicited a wide focal area, from spend management to workforce / talent management to risk management. It is within the latter area, risk management, that companies are beginning to implement more robust measures.
The modern compliance management checklist, while founded on principles related to procurement compliance and supply risk management, must also include items related to contingent workforce compliance. The following items must be considered as crucial additions for any procurement organization looking to build the next-generation compliance checklist:
- Multi-layered management of contingent workers (particularly ICs). In this instance, “multi-layered” would translate into a greater contingent workforce management strategy that involves principles taken from key stakeholders: spend management, finance, legal, IT, talent management, etc. All of these units can aid in how contingent workers are managed from a compliance perspective: from a spend threshold angle, from a legal perspective (particularly independent contractors), and from a talent requirement standpoint. Since contingent labor touches nearly every internal function, it is imperative that each unit adds its expertise in managing the compliance aspects of this category.
- Collaborative visibility into independent contractor assessments. The “assessment trail” is perhaps one of the most critical items that play into how a company manages its independent contractors. And, similar to the bullet above, it is critical that all units that leverage this type of freelance talent can easily (in real-time) assess compliance measures from a regulatory standpoint, further assisting in the quest to avoid federal audits and reclassification.
- Linkage between CWM program and SOW budget / project management. Those executives deeply-tasked with the inner-workings of the CWM program understand the impact of complex contingent labor (SOW-based labor and services) on their organization. This strategic, yet intricate, area of the Contingent Workforce Management Framework is critically important to track from a compliance standpoint due to its connection to high-budget corporate projects. Every CWM program must place measures to track (yes, in real-time!) how complex contingent labor is performing against pre-communicated and agreed-upon milestones and delivery dates.
