Tenure limits are a common contingent workforce program policy within staff augmentation. While there are plenty of good reasons for using tenure limits, they can be challenging to business leaders and organizations on a whole. Among the drawbacks of tenure policies is losing acclimated, trained and productive talent before the project is completed.
When strict tenure limits are enforced, business unit leaders and managers can often suffer the unbearable thought of missing deadlines, training replacement resources, which result in additional costs to the deliverable they had hoped to accomplish prior to losing the contingent worker. Tenure limit pressures can lead some engagement managers to misclassify their staff augmentation assignments as SOWs.
A new approach. Some organizations are considering a different approach when it comes to critical resources that may be affected by a tenure policy by instead considering a fixed duration option:
A staff augmentation contract that will terminate at a future date when a specific ‘term’ expires — e.g., the completion of a project or task, the occurrence or non-occurrence of a specific event (covering for an employee who is on sick or maternity leave, for example).
A fixed-duration option may be a consideration for some of your business leaders within your organization as a way to protect their project from being affected by existing tenure rules. Durations for an assignment can vary and should be reviewed and approved by the program office to help ensure alignment with corporate policies.
Having clear and concise requirements as to which roles would be eligible for the fixed duration option is critical. Examples of roles you may consider for fixed duration assignments would be roles which require a longer duration due to the complexity of the role (i.e. IT, Engineering, etc.). Strong policies and processes will reduce and mitigate co-employment concerns and abuse of the fixed duration policy.
When considering whether fixed duration is something your organization can consider, be sure to include common functional area representatives such as legal, finance and human resources. Common concerns they may have with fixed duration could include increased co-employment risks — they may be concerned engagement managers will utilize this classification as a way to avoid tenure policies as a whole, keeping a contractor on assignment for as long as possible to avoid having to hire a FTE or replace the existing contingent worker.
The utilization of a strong policy and the involvement of the MSP (either internal or external) can help drive the correct classification of the contingent workers.
Utilizing a ‘decision tree’ (either implemented within the VMS or manually conducted) can help create a consistent approach to classifying these workers and whether they should be considered for fixed duration. It is also imperative that you do not lose sight of these fixed duration resources to ensure proper tracking and reporting on them. Once these mechanisms of managing fixed duration are in place, your organization will be able to determine the impact to the business both positively and negatively.
The days of forcing all contingent staff augmentation workers into a single tenure policy may become a thing of the past. Your willingness to consider this approach and accomplish the implementation of fixed duration will delight the business and appease your legal, finance and human resource colleagues as you are willing to challenge the status quo and find ways to help contribute to your organizational bottom line through innovative thought.