Find your local office

Blog

Back to listing

Should your business be embracing the gig economy?

High profile coverage of companies such as Uber (which lost the right to classify its UK drivers as self-employed at a tribunal) have increased scrutiny of the gig economy in recent months. Yet despite the criticism, it shows no signs of abating, with latest figures suggesting that around 17.8% of the Australian workforce is currently self-employed.

The potential benefits of the gig economy for workers are fairly well-versed – flexible hours, more autonomy, better work-life balance, working from home, higher pay – but just what are the benefits for companies, and what do companies need to look out for when employing freelancers?

Flexible resourcing. Most companies find that demand goes through cycles, with particular times of the year far busier than others. One of the biggest benefits of employing freelancers over permanent staff is that you can flex resource up and down to reflect demand, keeping overheads to a minimum and allowing you to offer more competitive rates to your clients.

But as the Uber case study demonstrates, flexible staffing policies mustn’t equate to substandard ones – you may need to restructure your employee policies to ensure that you’re offering fair employment conditions to all.

Access to a global talent pool. Advances in technology mean that it’s often just as easy for colleagues to collaborate on a project virtually as it is for them to work together face-to-face. In this way, companies are no longer tied to recruiting staff locally and are instead able to source the very best people from right across the globe, potentially on a project basis.

However, businesses need to bear in mind that vetting people who are based abroad can be more difficult, time-consuming and ultimately more costly than local alternatives. And remember that when you recruit globally, you’re opening yourself up to even more competition – you may find yourself offering more than for talented local candidates..

Diversity of expertise. By embracing the gig economy, firms can use people with very specific skills for individual projects, rather than relying on existing staff whose expertise might lie elsewhere. In this way, companies can be sure that they have the exact skills they need for each project to be a success.

The downside may be that by regularly looking to fill skill gaps with short-term contractors, you’re eroding worker loyalty within your business. You may currently employ workers who would like the opportunity to learn new skills if this was presented to them. Further, constant recruitment, even of freelancers, can be expensive unless you have some very slick and robust recruitment processes in place.

For small companies, using freelancers may give access to a broader range of skills, on an ad hoc basis than would be available if they had to employ those skills directly.

When you do decide to try the gig economy marketplace its essential to take care that, your company messaging is always consistent; if not, you risk damaging your corporate identity.

The growth of the gig economy offers huge opportunities and to companies, of all shapes and sizes. However, there are some risks that need to be managed – from ensuring consistently high levels of freelancer performance, to treating all workers fairly and staying within the law.

In addition, a whole new chapter is opening with the recent abolition of 457 Visas for overseas workers.

For help and advice on making the gig economy work for your business, call The HR Dept on 1800 HRDEPT (1800473 378)