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The High Costs of Contingent Workforce Conflict

Posted by Tara Jones

5/5/15 6:30 AM

Conflict between and among permanent employees is a situation that no company ever wants to face, from costs to animosity to bad morale that infiltrates your entire team. However, when you encounter clashes that involve your contingent workforce, even more is at stake. For the most part, you’re already short-handed when you hire contingent personnel. Incidents that detract from these workers getting their jobs done affect your bottom line, at a time when the pressure is already on. 

Whether you’re facing conflict now or simply want to prepare for future, it’s helpful to have a look at the high costs of contingent workforce disputes – and learn ways you can prevent them from arising.

Steep Short Term Costs

Job Abandonment:  When you’re unhappy with a situation, you tend to avoid it; the same goes for your contingent personnel when their workplace environment is less than pleasant. You’ll see more absenteeism, job abandonment and lackluster performance when your contingent worker is experiencing conflict within your company.

Delays in Production: The above issues with job attendance and performance will ultimately impact your company’s operations, no matter what industry you work in. The “I don’t care” attitude can cause delays in production and increased cycle times; waste of materials and inventory can also result.

Lost Business Opportunity: It’s hard to put a number to the opportunities that your company misses out on because your contingent workforce and other team members are preoccupied with conflict. They may be so busy playing catch up with normal business operations that potential profits fly right out the window.

The Bigger Picture on Long Term Costs 

You’re spending more on labor to fill gaps in production: You need to make up for the inefficiencies that result from conflict in the workplace, so you’ll need to invest more on labor to meet production demands. Hiring, training and developing for these positions is an expense you don’t need. 

Managing conflict tasks other company departments: You likely have personnel who are responsible for human resources matters, and disputes fall under that umbrella. The more time these people spend on conflict issues, the less they can address other HR issues.

Preventing Contingent Workforce Conflict

  1. Establish a process whereby contingent workers can get assistance in resolving conflicts. Your workers must know to whom they can turn when they need help and that includes dispute issues. Identify the manager or HR person who’s in charge of resolving these matters and listening to concerns. 
  1. Get to the source of the conflict before reacting. The cause of disputes may not be immediately discernible, so you must use diplomacy when you’re conducting your investigation – whether it’s a person, group or incident. Find the root of the problem before taking any action, as you might end up unintentionally making matters worse without understanding the whole situation. 
  1. Invest yourself personally to show empathy. Create a personal connection with your staff, both permanent and contingent workforce members. You can put yourself in their shoes to show unity with their position without sacrificing their respect. 

Dealing with conflict in your contingent workforce might be among the most thankless parts of your job, but there’s no question that it’s necessary and critical. In a way, disputes are like a virus that spreads throughout your personnel, getting more toxic and infectious along the way. It’s up to you to nip conflict in the bud when it does occur, by establishing a strong, documented process for addressing disputes.

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Image Source: Pictures of Money

Topics: Contingent Workforce Management, Human Resources, Contingent Workers, Reducing Turnover