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WINNING THE WAR FOR

TEMP TALENT
How to Reduce Costs, Improve Quality
& Stay Compliant

About the Presenter

Bill Inman
CEO & Founder
18 years as executive and entrepreneur in the
human capital and temporary labor industry:
Board/Executive, HR Tech & Workforce Mgmt
Employer of Record Company Founder

MSP/VMS Executive
Applicant Tracking System Founder
Former Staffing Company Owner

linkedin.com/in/billinman
billinman.com/gig

billinman.com/gig
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Presentation Overview
Temp labor and the Gig Economy have become critical
components of the U.S. labor force, and are expanding rapidly
However, utilizing the services of temps, contractors
& on-demand services is more complex and costly than ever.

This presentation covers:

The Growth of the Gig Economy
Recruitment Challenges for Temp Labor

Temp and Gig Recruitment for Contact Centers

Temp and Gig Workforce Compliance
Best Practices & Compliance Solutions
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Disclaimer
Nothing on this presentation is intended to create any contractual
or other legal relationship between the presentation viewer, Bill
Inman, PeopleLoop, or any of PeopleLoops staff, and should not
be construed as legal advice or professional opinion for handling
a specific factual situation.
PeopleLoop or Bill Inman cannot guarantee or warrant the
accuracy or completeness of information in this presentation any
way.
Presentation participants and readers should not act upon any
information from this presentation without consulting with the
appropriate legal, financial, or other business professional for
guidance and advice.
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Growth of the Gig Economy

The New Labor Revolution

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Work Performance, Utilization, Arrangement & Macro Factors

2016

Temp & Gig Growth

Temp and Gig Work Arrangements

50%
by
2020

% of the employed (U.S.) in alternative work arrangements

Temp & Gig Growth

Sources: Bloomberg (2015), Labor Department (1995, 2005);

Alan Krueger of Princeton and Lawrence Katz of Harvard (2015)

Global Gig Economy Growth

Orgs with Workforce >50% External Talent

Global Temp
& Gig Growth

Source: CGMA New Ways of Working Survey, 2014

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Global Temp and Gig Labor Spend

Global Temp
& Gig Growth

Source: Uneven Geographies of Digital Wages

Oxford Internet Institute, University of Oxford

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Contact Center Recruitment Trends

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Contact Center Recruitment Trends

Contact centers continue to
grow in size & strategic importance

Contact Center Volume

Expected to Grow
Contact Center Leaders & CXO
are Accountable for Customer
Experience

Employee Satisfaction &

Engagement Important
Contact Center
Recruitment Trends

Source: Deloitte 2015 Global Contact Center Survey

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Increased Demands for Diverse Skill Sets

Contact Center
Recruitment Trends

Source: Deloitte 2015 Global Contact Center Survey

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More Talent Already Employed

Unemployment Rates by Education (U.S.)

Contact Center
Recruitment Trends

Source: Bureau of Labor Statistics

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Contact Center Staff Turnover

National Turnover
Average
All Position Types
& Industries

16.4%

Contact Center
Recruitment Trends

Sources: Deloitte 2013 Global Contact Center Survey, BenchmarkPro

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High Turnover Costs

The average contact center turnover costs $6,440 per person
Recruiting cost = Campaign to hire 20 employees
Hiring cost = (40 HR hours (2 per candidate) @ $20/hour)

$ 5,000
$ 800

Hiring cost = (60 call center hours (3 per candidate) @ $20/hour)

$ 1,200

Training cost = (5 sessions x 80 hrs @ $20 trainer cost)

$ 8,000

Training cost = (Materials/expenses @ $500 per person)

$ 10,000

Unproductive training time = (3 wks paid time x 20 people @ $12/hr)

$ 28,800

Supervisory time = (10 addl hours per person @$15/hour)

Overtime costs = (25 days x 8 hours x 20 people @$12 x 1.5 rate)
Total Hard Cost of Turnover (20 EE)

Per Person Turnover Cost

Contact Center
Recruitment Trends

$ 3,000
$ 72,000
$ 128,800

$ 6,440
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Effective Contact Center Recruitment

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Competitive Compensation

Median U.S. Hourly Contact Center is $12

& Average U.S. Raise (all industries) 3% in 2016
Manufacturing and logistics:
Electromechanical technician: 9.29%
Assistant plant manager: 8.05%
Maintenance manager: 6.65%

Engineering:
Electronics/computer engineer: 8.31%
Mechanical engineer: 7.38%
Quality engineer: 7.36%

Information Technology:

Office and administration:

Network engineer: 7.21%

Software engineer: 5.48%
Project manager: 3.87%

Office manager: 6.68%

Effective Contact
Center Recruitment

Contact Center Rep General: 4.55%

A/R Supervisor: 4.50%

Source: Randstad, Staffing Industry Analysts, Payscale

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Recruiting Locally Limited by Commute

For Typical Bricks and Mortar Contact Centers

80% within
a 20-minute drive
Effective Contact
Center Recruitment

95% Drive Less Than 30

Minutes to Work

Source: Site Selection Group

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Alternative Arrangements as Recruiting Tool

Hub-and-Spoke
Model

Work-from-Home
option for top
performers or new
talent with a long
commute
Effective Contact
Center Recruitment

Virtual
Model

True Work-fromHome Agent Model

Source: Site Selection Group

Flexible
Scheduling

Allowing employees
to manage time in
the manner best for
them

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Temp & Gig Labor to Meet Talent Demands

Since 47% of contact centers have 10% to 100% annual
turnover and recruiting locally is limited, sourcing
temporary and gig workers makes sense.
The majority of contact center workers (aged between
20-34) stay only about one year.
A Temp or Contractor would typically be someone who
expects to work a contract of between 4 18 months

Therefore, it make sense to hire temp and gig workers to

reduce turnover costs and provide the company faster
access to talent.
Effective Contact
Center Recruitment

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Traditional Bricks Contact Center

Effective Contact
Center Recruitment

Source: Deloitte Global Contact Center Survey

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Gig Economy Worker Characteristics

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Effective Contact
Center Recruitment

Source: Intuit

Reducing Temp & Gig Labor Costs

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Temp/Gig vs Direct Hire Cost Savings

92%

9%

Companies that Believe Using

Temp Labor Saves Money

Median Savings
Over Direct Hire

Source: Staffing Industry Analysts

Reducing Labor
Costs

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Cost Savings Reasons

Reduced recruiting & hiring costs

Lower training costs

Reduced statutory employer burden

Reduced administrative HR tasks

Reduces need for severance pay

Not paying for down time

Effective Contact
Center Recruitment

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Traditional Staffing Options & Costs

Staffing
Vendors

Contract
Workers

Indep.
Contractor /
1099

40%
Markup

~10%
Markup

Outsourcing
Service
Providers

SOW

ProjectBased
Workers

Milestone Payments

Self-Sourcing

Internal
Resources

Alumni &
Previously
Used
Workers

Referrals

~25%
Markup

*Markups are generally charged on the pay rate of each worker

Effective Contact
Center Recruitment

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Self-Sourcing Temp & Gig Labor

Leverage Existing Recruiting Resources

Utilize Company Alumni

and Previously Used Resources

Ask for Internal Referrals

Engage Project Based Recruiters

Create Your Own Talent Community

Leverage Gig Sites

Effective Contact
Center Recruitment

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Gig & Temp Labor Compliance

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Co-Employment
When the company that utilizes the temp or gig workers services
(client) manages the workers on a day-to-day basis they often
become a co-employer or joint employer along with the supplier of
the the worker.

Co-employment could mean that

the client company may be held
liable for the decisions and
mistakes of the supplier and
vice versa
It is common to see both clients and providers of temporary staffing
both identified as defendants. -Staffing Industry Analysts

Temp & Gig Labor

Compliance

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Staffing Buyers Increased Liability

In CA Client & Supplier liable

for payment of wages and/or
failure to provide workers
compensation coverage. Other
states are likely to follow

Temp & Gig Labor

Compliance

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Worker Classification Wage & Hour

Issue:
An investigation by the U.S. Department of Labors Wage and Hour
Division found that a call center misclassified hundreds of call-center
agents as independent contractors rather than employees, and
subsequently denied them minimum wage and overtime for hours they
worked, in violation of the Fair Labor Standards Act. The firm also failed to
pay employees for time spent in training, creating additional violations of the
FLSA. The company has reclassified all call-center agents as employees and
will pay $101,491 in back wages for minimum-wage violations to 435
employees plus $48,893 for unpaid overtime due to 165 employees.
Lessons:

Ensure that the temp and gig workers your company uses are classified exempt/non-exempt
correctly.

If 3rd party employer, audit or monitor their employment to ensure they are compliantly meeting
Wage & Hour law requirements.
Temp & Gig Labor
Compliance

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Worker Classification Wage & Hour

Wage Theft in the Contact Center Space is an increasing
problem. Many companies & 3rd party providers do this
unknowingly. Improving education and reviewing best
practices is essential.

Temp & Gig Labor

Compliance

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Contact Center Wage Theft Lawsuits

A worldwide hotel brand settled with 2,645 current & former Call Center
employees for $715,000 in back pay & overtime wages.

Leading U.S. Insurance Company agreed to pay more than $1.5 million in
back pay & overtime wages to nearly 3,500 Call Center employees after
federal authorities accused the company of significant and systematic
violations of overtime and record keeping rules.

Midwestern technology company recently settled a class action lawsuit for

around $320,000 at two Spokane, WA Call Centers. Employees alleged they
were not paid for work until the time they took their first phone call - but
were required to spend 15 minutes logging into computer programs that
were required to handle the phone calls.

A large computer services company agreed to pay $4.5 million to settle

allegations that their Call Center employees were not properly paid for
hours worked. Claims include employees often spent time before shifts
searching for an available computer terminal, headset, or passwords.

Temp & Gig Labor

Compliance

Temp & Gig Workforce Best Practices

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Compliance Best Practices

.

Solutions to mitigate temp & gig workforce risks, include:

Supplier Qualification Processes

Sourcing & Selection Considerations

Enhancing Supplier Agreements

Defined Internal Policies

Temp & Gig Labor

Best Practices

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Workforce Supplier Qualification

. through a formal supplier qualification process to:
Go

Ensure financial stability of the supplier

AND that they hold the proper insurance.

Make sure the Supplier has documented

human resources and safety policies
(ideally outlined an employee handbook).
Perform supplier reference checks.
Ask the supplier to provide documentation
about their payrolling and employer policies.

Temp & Gig Labor

Best Practices

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Worker Sourcing & Selection

When sourcing temp & gig workers consider:
Clearly defining and documenting the
assignment description for worker
and supplier.
That suppliers should screen (and perform
background checks when appropriate for)
the worker.
Hiring workers with sufficient skills to perform
the required tasks and who do not require
general training.
Temp & Gig Labor
Best Practices

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Supplier Agreement
Defined supplier agreements may help limit risk:
Consider moving away from timecard agreements.
Clearly outline responsibilities of each party.
Identify proper insurance limits in agreement.
Ensure proper indemnification in place.
Complete a Statement of Work for
each new assignment.
Consider consolidating gig employment under one company
Temp & Gig Labor
Best Practices

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Internal Workforce Best Practices

Clients should mention exemption of temp/contract
workers from regular employee benefits in employee
handbook.
Educate the managers who use temp/contract labor on
procedures:
- Discontinuing Assignments
- Performance Communication
- Disciplining Workers
Develop an internal temp/contract worker best practices
manual.
Temp & Gig Labor
Best Practices

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Further Limiting Workforce Risks

The supplier should have established procedures
for accidents.

Clients should provide worksite specific safety

training for all newly on-boarded workers.
Performance and disciplinary communications to
the worker should be made by the supplier.

Injuries should be recorded in accordance with

OSHA regulations.
Temp & Gig Labor
Best Practices

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Presentation Summary
The Gig Economy and temp labor is growing fast and is
probably part of your companys workforce strategy.

This workforce can be a great supplement to your internal direct

hire contact center workforce if recruited and utilized effectively.
Much of this workforce is provided and employed by traditional
staffing and virtual solutions (on- and off-shore).

Companies must be strategic about compliance because of

regulations and co-employment.
Mitigate workforce risks and reduce costs by wisely selecting
and monitoring both internal best practices and the best
practices of your vendors.
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For attending this session. Please remember to fill out

your evaluation forms!
Bill Inman
bill@peopleloop.com
linkedin.com/in/billinman
billinman.com/gig

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