Everything You Need to Know About Contingent Workforce Management 2025 | Conexis VMS

What are the Components of a Contingent Workforce Program?

Your Contingent Workforce Program should include these key components: 

1 - Centralized Visibility: Costs, KPIs: Gain a clear view of all external workers, costs, and performance metrics.

2 - Defined Processes: Standardize onboarding, offboarding, compliance, and engagement.

3 - Compliance Controls: Establish protocols to ensure legal and tax compliance.

4 - Partnerships: Work with reliable vendors to fill roles quickly and compliantly.

5 - Technology Integration: Use a Vendor Management System (VMS) to automate workflows, track spend, and ensure compliance.

What are the Benefits of an Effective Contingent Workforce Program?

Managing your contingent workforce strategically provides numerous benefits, including:

Cost Savings:

Reduce overhead and avoid long-term employment costs. To attract full-time employees companies must spend money on benefits and other incentives that help them to attract and retain the top talent. By using contingent workers, however, companies only need to pay non-employee workers for the work they actually do.

Flexibility:

Scale labor up or down quickly to match business needs. The use of contingent workers gives companies the ability to assess company needs on an ongoing basis. Whether an organization needs expertise on a short-term basis or seasonal workers during a peak season, the contingent workforce gives companies the capability to immediately meet their workforce targets.

Access To Talent:

Engage specialized skills not available .internally. Acquiring top talent is more competitive than it has ever been before. Organizations are now contending with their competition to access in-demand talent from a small pool of workers. Using contingent workers is a great way for organizations to navigate the skills gap and hire hot skills for immediate positions. 

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. 

What are the Differences Between Contingent Workers and Employees?

When building an internal contingent workforce, compliance is crucial. Companies must comply with local regulations and laws, making sure not to misclassify their contingent workers as contingent when lawmakers would see them as employees.  

This can be difficult, because the difference between a contingent worker and a traditional employee isn't always clear and classification laws vary in each country, state and even city. 

There are three important factors that distinguish the difference between contingent workers and employees: 

• Contingent Workers are not on the company payroll. Contingent Workers are hired for a defined period of time.
• Unlike employees, contingent workers are only hired either for a defined period of time or for a specific project.
• Contingent Workers are typically not eligible for benefits. Some contingent workers are not eligible for the same benefits that employees are entitled to, such as vacation time, sick pay, bonuses or retirement plans. However, this can become confusing as it differs depending on the category or worker and the location they are beings sourced. T4 or W2 contingent workers are sourced via a staffing agency, for example are entitled to classic employee benefits although it's typically the staffing agency who provides these benefits and not the hiring organization. 

Types of Contingent Workers

The contingent workforce is a pool of non-employee workers who are hired by an organization on an on-demand or project-by-project basis. These workers are not considered employees of a company. Instead, they work under a contract or a temporary basis. 

• Unlike permanent employees, contingent workers are only with an organization for the continued existence of the job at hand - whether that be completing a specific project or working for a pre-determined period of time.
• Once this short term engagement is completed, a contingent then moves on to a new job with a different organization.   
• Contingent workers come in many forms, each offering different levels of flexibility and risk.
• The term independent contractor is an umbrella term for different types of workers, such as freelancers, consultants and gig workers.
• Understanding the type of contingent worker you're engaging helps determine the appropriate onboarding, compliance, and management processes.

The most common types of Contingent Workers include:

Temporary workers

Temp workers are hired through staffing agencies Temporary workers are typically employed through a staffing agency, placed within your organization to fill specific staffing requirements you have. They generally work for a business for a predetermined period of time to meet seasonal demands, fill temporary positions or help companies scale up rapidly. 

Freelancers

Freelancers are hired directly for short-term tasks, Freelancers are self-employed professionals who offer services on a proejct-by-project basis usually without long term commitments. They are independent contractors who set their own rates, choose their clients, and determine their own work schedule

Independent Contractors

Independent Contractors provide specialized services, Independent contractors, who are classified as self employed and not placed within a business by a staffing vendor, are usually hired to work on projects or to perform a defined set oof deliverables and deadlines. They are able to work from where and when they want, and are generally experts in the specific field they are working in. 

Consultants

Consultants engaged for strategic expertise. A consultant is a professional who provides advice or services in an area of specialization. 

Gig Workers

Gig workers do quick, task-based jobs using digital platforms for on-demand work.

Why a VMS is Essential in Managing a Contingent Workforce Program

Many organizations are still using manual spreadsheets, in-house databases or Sharepoint-like websites to manage their contingent workforce.

This is simply ineffective - and where a vendor management system will help.

A VMS is a cloud or web-based platform that acts as a mechanism for an organization to procure and manage its non-employee workforce. It’s a software platform that supports a company in structuring and optimizing every process related to contingent workforce management. 

By automating every process in contingent workforce management and consolidating all vendors and information into one centralized location, a vendor management system significantly improves how you manage each step in the contingent workforce management process from sourcing, hiring, tracking and invoicing non-employee workers.

This leads to better visibility into your program, significant cost savings, improved process efficiencies, and contingent workforce compliance. 

What are the Benefits of a Vendor Management System?

A VMS will bring a huge ROI to your company’s contingent workforce management program, and that’s because it’s capabilities will significantly improve your processes, reduce costs and lead to far greater visibility into your program.

Improved efficiencies:

The automation of processes such as onboarding, time entry and approval will save your organization countless hours and lead to better internal efficiencies across your company. 

Complete visibility into your program:

Since your entire contingent workforce management program is now stored in one location, instead of being fragmented across different departments and hiring managers, you’ll have complete visibility into where you may be overpaying vendors or mismanaging contingent workers.

Vendor consolidation:

With your vendors consolidated into one location, your VMS will act as a central hub that gives you all the information you need to evaluate whether each staffing agency you use is helping you to meet your company’s unique workforce targets. This leads to more insightful and strategic vendor choices. 

Reduce costs:

By helping you to get the lowest prices from vendors, cut down on rogue spend in your contingent workforce management program and save money on process efficiencies, a VMS can help your business improve its contingent workforce management expense - to improve your bottom line and become more profitable. 

Choosing the Right VMS for Your Contingent Workforce Program

Here are some considerations when choosing the right VMS for your organization:

The ability to consolidate vendors:

For clear visibility into your staffing agencies and vendor performance, a VMS should be able to consolidate all of your vendor information into one centralized location. This will improve how you manage, and analyze the performance, of those vendors.

Automation of processes:

A VMS solution is a significant improvement from managing your contingent workforce using spreadsheets because the software should be able to automate your processes. Look for a vendor management system that can automate all of the time-consuming processes associated with managing your vendors, from sourcing, onboarding, analyzing performance, payment processing and much more.

Vendor standardization:

Want to prevent rogue spend from occurring across your contingent workforce program? A VMS solution will improve vendor standardization across your business. This will act as a framework for how hiring managers across your entire company use and pay vendors. 

Centralization of your program:

Contingent workforce programs require a large amount of data, including both vendor information and worker information. The ability to centralize this in one centralized location will ensure your company has complete visibility into its program and that company policies around this workforce are being followed by all departments. This increased visibility ensures you are also able to view program performance and make better vendor/hiring decisions moving forward.

Additional VMS Features:

Other top features that you should look out for in a VMS solution should include: Simplicity of use, Invoicing, Process requisitions, Process approvals, Onboarding tools, Scalability for company growth and Visibility into vendor performance. 

Choosing a VMS for a Mid-Market Contingent Workforce Program

For organizations managing a contingent workforce program with an annual spend under $70 million – selecting the right Vendor Management System (VMS) is critical.

• Your VMS should provide a scalable, efficient, and comprehensive solution without requiring multiple systems or extensive customization.
• Yet when it comes to companies transforming how they manage their contingent workforce program, many of the traditional legacy VMS providers have designed their software for large organizations with enterprise-level contingent workforce volumes. 

When choosing the best VMS for your mid-market program, ensure that it has been specifically designed and built to meet your needs, and provides you with the flexibility, affordability and customer care you need.  

For additional information, check out our Mid-Market Contingent Workforce Guide. 

Why Choose Conexis as your VMS Partner

Our software has been developed by  contingent workforce experts and was built from the ground up using the latest tech stack. This means we can do more for you at a lower cost, with more flexibility, provide better customer care, and deliver a better user experience. 

Conexis is an award-winning VMS tailored specifically for mid-market contingent workforce programs. Built on the latest tech stack, we are THE most modern, advanced and innovative VMS on the market today. We deliver the expertise, reliability, and security of an enterprise system, while offering the flexibility, user friendliness and tailored service you require. Essentially, Conexis delivers enterprise level software - without the enterprise level complexity and cost. 

Here's why you should choose Conexis as your VMS Partner. 

    Our Expertise

At Conexis, our Leadership Team brings extensive 'hands-on' experience in the Contingent Workforce Industry, particularly in Workforce Management, Consulting, Procurement and Talent Acquisition roles.

Industries: 

This expertise spans across various industries including Consulting, IT,  Manufacturing & Light Industrial, Consulting,   Government,  Pharma, Warehouse & Logistics and Healthcare.

Our Tailored Solutions:

We also bring a tailored solution for MSPs, Staffing Agencies, HR and Talent Acquisition, Procurement, and Contingent Workforce Management Professionals. 

With Conexis, you get dedicated senior leadership to help you succeed.

    Our Advanced Technology

We have the most modern and advanced VMS tech stack available today. It starts with the latest codebase and extends to our lightning-fast AWS microservice infrastructure. Add to that our Open API and Software Development Kit (SDK), making Conexis the lights-out leader in VMS technology. Our open APIs and flexible data solutions also allow our customers to create fast, easy, and cost-effective integrations, that can be done in under a week, compared to the legacy systems, which have to custom code each one. 

   Our Flexible Pricing

We offer flexible pricing with no set up costs. We offer a range of pay-as-you-go pricing models. In addition, some highlights of our pricing include: Flexible Percentage of Spend or Licence Fee Pricing, free setup and implementation, no cost standard customization and configuration included, no Cost API, and no cost for a dedicated account team. You can save money, not only at set up, but on an ongoing basis with our affordable monthly pricing. 

    Our Work-Shifts, Worker Scheduling & Credentialling

We are one of the only VMS' in the market with functionality designed specifically to support high-volume fluid workforce environments. With our market-leading work shift scheduling, advanced timekeeping, and worker credentialing capabilities, Conexis is the only VMS that can handle all skill categories without clunky third-party add-ons.

  We're Easy to Use

The Conexis user interface was created using system design science. Our goal was to create an intuitive, easy-to-use, and easy-to-navigate interface. And we have succeeded... Among current users, Conexis leads the VMS Industry with a higher-than-industry NPS score of 71. (According to SIA, industry average for a VMS is -35). This means that our customers love our system and would recommend it to others. Our customers also report much higher levels of adoption due to our user interface and easy-to-use flows.

    Our Unbeatable Customer Care

"91.7% of all user inquiries are resolved within three hours". We are so proud of this statistic. Conexis puts a premium on Customer Care. We are on a mission is to make every customer feel like our number one customer because they are! Our Customer reviews are authentic and market leading. Each customer is supported by a dedicated and highly experienced "We Care" team that meets rigorous SLA levels to ensure the client's questions are addressed immediately.

   Our Advanced Analytics and AI

Our advanced reporting and analytics module gives customers valuable insights into their program’s performance and contingent workforce population. This critical information enables improved decision-making to improve quality, speed, compliance and cost. Combine this data with our impressive set of AI-driven tools, like candidate matching, to put your program into high gear.

    Our Fast Implementation 

No longer does it take 4-6 months to implement a VMS. Conexis is built on the latest tech stack and we can have you up and running within a few weeks. With turnkey solutions, modular design, and streamlined integration capabilities, VMS implementation can now be completed in weeks instead of months.

    Our “Easy Switch” Program

It’s easy to switch your VMS to Conexis with the Conexis “Easy Switch” program. Conexis makes switching your VMS easy. Our dedicated "Easy Switch" Team will take care of every detail for you, ensuring a seamless transition with minimal disruption. We handle all the complexities, so you can focus on your core business activities without any interruptions and be fully operational in just a few weeks.

     Our White Label Partner Program

Because we are built on the very latest tech stack, we  can provide you with a fully White Labeled VMS your own unique URL, for a very affordable rate. The benefit of a white label VMS is that it enhances your product offering and provides a seamless experience for your clients.

Grow Your Business with a Master Vendor Program

If you are looking to increase revenue and grow your business through a Master Vendor Program, we can help. Our White-Label VMS is exactly what you need and can be customized with your brand for a seamless client experience. 

    Our Mid-Market Focus

Leveraging the latest technology, Conexis delivers the expertise, reliability and security of enterprise systems, while offering the flexibility, user friendliness and tailored service you require. Conexis delivers enterprise level software - without the enterprise level complexity and cost for Mid-Market Contingent Workforce Programs.

    Our Client Testimonials

At Conexis, we believe that the true measure of our success lies in the voices of those we serve. Our clients' feedback is invaluable, offering genuine insights into the transformative impact our solutions have on their businesses. By reading our Conexis client testimonials, you will discover firsthand accounts of how Conexis has revolutionized their operations, enhanced efficiency, and delivered exceptional value. These stories are a testament to our commitment to excellence and our dedication to helping our clients achieve their goals. Dive into their experiences and see why Conexis is the trusted partner for so many.

    Our Native Shift Based Worker Functionality

Unlike other VMS platforms that offer shift scheduling as an afterthought, Conexis was designed with native shift-based workforce management at its core. This means you can manage all scheduling, pay rates, and compliance in one system, reduce payroll and invoicing errors, have real-time workforce visibility with instant access to who is working, who is available, and where gaps exist; and scalability - so you can easily manage shift-based workforces across multiple locations and job types.

   Our Open API

Our VMS has Open APIs which gives you the ability to access raw data and create custom reporting suites tailored to your needs, which enhances the quality of service and drives operational efficiencies and scalability.  

By harnessing the power of Open APIs, you can transform your reporting capabilities, providing users and clients with the insights they need to manage their contingent workforce effectively.  

 Our Partnership

At Conexis, our priority is on building partnerships and helping you succeed and grow. We offer many Conexis partner programs, so if you are a Staffing Agency, MSP, Contingent Workforce Consultant or HR Technology Provider looking for a VMS Partner who wants to help you grow your business, contact us!

Glossary: Key Contingent Workforce Management Terms

This glossary is designed to provide simple, straightforward definitions of the most common terms and acronyms in the contingent labor space - so you can communicate with confidence and clarity.