What's the Role of a VMS in a Contingent Workforce Management Program?

The contingent workforce is an ever-growing resource for organizations that want to fulfill their staffing requirements, yet many organizations are still struggling to implement successful contingent workforce management programs. With this in mind, we wanted to share the key information you need to know in order to implement a successful contingent workforce management program.

What is Contingent Workforce Management?

Contingent workforce management is the strategic process of sourcing, organizing, and optimizing external workers—such as independent contractors, freelancers, temporary staff, and consultants—who are not part of your company’s full-time workforce.

With organizations increasingly relying on flexible labor to reduce costs, respond quickly to market changes, and access niche skills, managing contingent workers efficiently has never been more critical.

This guide explores the key components of contingent workforce management, including benefits, risks, compliance, staffing agency partnerships, and how technology like a Vendor Management System (VMS) can streamline operations.

Types of Contingent Workers

Contingent workers come in many forms, each offering different levels of flexibility and risk. The most common types include:

Temporary workers hired through staffing agencies
Freelancers hired directly for short-term tasks
Independent contractors who provide specialized services
Consultants engaged for strategic expertise
Gig workers using digital platforms for on-demand work

Understanding the type of contingent worker you're engaging helps determine the appropriate onboarding, compliance, and management processes.

Benefits of Contingent Workforce Management

Managing your contingent workforce strategically provides numerous benefits, including:

Cost Savings: Reduce overhead and avoid long-term employment costs
Flexibility: Scale labor up or down quickly to match business needs
Access to Talent: Engage specialized skills not available internally
Faster Hiring: Fill skill gaps and roles more quickly
Reduced Risk: With the right tools and processes, mitigate risks related to misclassification and non-compliance

Key Challenges in Managing a Contingent Workforce

While the benefits are significant, poor contingent workforce management can lead to:

Worker Misclassification Risks (e.g., treating contractors like employees)
Compliance Issues with labor laws, tax regulations, and co-employment
Lack of Visibility into contingent labor spend and performance
Inconsistent Processes across departments or business units

These challenges can expose your organization to legal risks, increased costs, and lost productivity.

How to Build an Effective Contingent Workforce Management Strategy

To manage your contingent workforce effectively, your strategy should include:

Centralized Visibility: Gain a clear view of all external workers, costs, and performance metrics.
Defined Processes: Standardize onboarding, offboarding, compliance, and engagement.
Compliance Controls: Establish protocols to ensure legal and tax compliance.
Partnerships with Staffing Agencies: Work with reliable vendors to fill roles quickly and compliantly.
Technology Integration: Use a Vendor Management System (VMS) to automate workflows, track spend, and ensure consistency.

The Role of a VMS in a Contingent Workforce Program

A VMS is essential for streamlining contingent workforce management. It acts as a centralized platform to manage the entire lifecycle of external workers. With a VMS, you can:

Track time, spend, and performance across all contingent workers
Automate requisitions, approvals, and invoicing
Ensure compliance with local laws and classification rules
Consolidate data for better decision-making

For mid-market companies, a VMS like Conexis makes it easier to manage growing contingent programs without adding administrative overhead.

Final Thoughts

Contingent workforce management is no longer a tactical HR function—it’s a strategic advantage. As the workforce continues to evolve, organizations that invest in managing their external labor effectively will gain flexibility, access to talent, and a competitive edge.

A modern VMS like Conexis gives mid-market businesses the tools to manage contingent labor with confidence, reduce risk, and drive measurable results.

Learn more at our 2025 | Contingent Workforce Management Guide

Learn more about How to Choose the Right VMS

Learn more about the Benefits of a VMS and what to look for when choosing the best VMS for your organization. Download our Free VMS Buyer's Guide here:

Discover the Power of Conexis VMS

Conexis VMS is purpose-built for organizations seeking to manage their contingent labor spend effectively. Here’s why we're the right choice:

Fast Deployment: Get up and running in weeks, not months
Transparent Pricing: Flexible pricing with no hidden costs
White-Label Ready: Customize the platform with your brand
Real-Time Insights: Make faster decisions with built-in analytics
Audit-Ready Compliance: Store contracts, worker data, and rates in one secure hub

About Conexis VMS

Conexis is an award-winning Vendor Management System built for organizations that want the power of enterprise software without the complexity or cost.

Leveraging the latest technology, Conexis delivers the expertise, reliability and security of enterprise systems, while offering the flexibility, user friendliness and tailored, personal service you require. Learn more about our Company and why organizations Choose Conexis VMS.

Looking to Switch Your VMS or Just Getting Started?

Whether you are looking to Switch your VMS, or just Getting Started, we are here to help. Contact Us for a Free No-Obligation Consultation, See how Easy Conexis is to use by taking a quick 2 minute Self-Guided Online Demo, or Book a Personal Demo Today!