In the previous years, companies would hire workers on a contractual work basis, with an expectation to get the most out of them. Originally, the idea was to have workers working in a controlled environment where they could focus on being productive and efficient. Employers aimed to give a fixed salary to the employees in exchange for their services.
But back then, business used to be conducted physically. Nowadays, everything is done online. Times have changed and people prefer to sit at home and get everything they need online. From groceries to furniture and from calling a cab to hiring a plumber, everything is done online. Not only do consumers want everything to be done online, but companies have also started to prefer interacting in the virtual world.
An Era of Freelancers
Nowadays, companies have ended contractual work-based hiring to an increasing extent. What they do is hire freelance workers to do their jobs on an order basis. For example, a digital marketing agency needs a graphic designer to help them with a client’s order. Previously the case would have been that they would have a graphic designer on board to do these tasks. But working in accordance with the technological transition in the world, the company would hire a freelance graphic designer only for that specific order.
Why would you hire a freelancer for Contractual work?
What do you think is the reason behind this complicated procedure of handing out work on the basis of orders? What this does is; helps cut down a lot of costs, especially for firms that have minimal business or clients. Take the same example of a digital marketing agency, only this time; they have an in-house graphic designer.
Minimal requirements
Let’s assume that this company only has a few clients who have very minimal requirements. They would find their graphic designer sitting idle most of the time because they do not have enough workload to keep him busy. The company would be wasting money paying him on a contractual basis and he would be taking up space.
I guess the reason must be very prevalent through the example mentioned above. The concept behind hiring freelance workers for contractual work is to cut down on costs like rent, electricity, regular payroll, etc. Companies do not need to give the same benefits to freelancers as they have to give to their regular staff members. Normally you have to provide your workers with health insurance, paid leaves, and whatnot.
Whereas, when you hire a freelancer, all you have to do is pay them their price for the job at hand. All of the supplies that might be used or the equipment like computers will be their responsibility. You do not have to pay any rent to give them a place to work, you do not need to provide them with a laptop and you definitely do not have to pay them for sitting idle.
Types of companies
Different types of companies hire different types of freelance workers. You can get online sales representatives, graphic designers, content writers, assignment writers, and whatnot. Did you know that you can even outsource an entire human resources team? Well, you can; they are called ‘head hunters’.
You can call them up when you are looking for workers and they will conduct interviews and hire the right workers for you. What this does is; cuts down on the costs that are incurred when conducting interviews.
In the same way, you can outsource any sort of work to freelancers. They will incur all the expenses; all you have to do is pay them for the work that they do. Freelancers are normally very cheap to hire and there is a large number of them available online. There are thousands of people that will do your work for you at affordable prices.
All the money that you save from outsourcing your work through freelancers can be put to effective use elsewhere. You can probably use all that money to expand your operations or launch a marketing campaign. There are endless possibilities once you figure out all the tricks to cutting down your costs and we all know that the highest cost in running any business is normally the labor. Workers take up most of your profits. But now, things have changed a lot. Running a business is becoming easier by the day.
Supporting employees made redundant
Employees can be traumatized by redundancy. Announcing redundancies can also negatively impact the morale and productivity of employees who are staying. Therefore, a good redundancy procedure should also include support for redundancies, such as finding alternative employment or providing counseling and support.
An employee with more than two years of service is also entitled to a redundancy payment based on a standard formula.
More about ending contracts
The topic of dismissals and contract terminations is much more complex than that. With our compliance guides, opinion pieces, and other HR resources, you’ll find detailed answers below.
