Tenure policies they are a-changin’

Tenure policies are being engaged less and less as a co-employment mitigation tool — which is a good thing — and more as a contingent workforce program talent resource management strategy tool. This indicates the changing landscape around program tenure policies as they evolve to meet the true needs of engagement managers and organizations that engage contingent resources.

The main evolutionary trend we are seeing in our buyer survey data since 2015 is that assignment length limits are consistently increasing in average length. Median assignment length limits from the 2020 buyer research are a robust 24 months — nearly a full year longer than five years prior — and just 3% of those who used assignment limits in 2020 noted a limit of less than a year.

No formal tenure policies. It might be surprising to some, but a consistent percentage of buyer respondents do not even have a formal tenure policy. In our most recent 2020 buyer survey research, 35% have elected not to deploy a formal tenure policy/assignment length limit.

We’ve heard anecdotally of some — but not many —  programs that have contingent talent engagements that are running over the median 24-month tenure limit to four, five, six years and beyond. According to the 2020 Buyer Survey, 18% have assignment length limits of more than two years. Certainly, these are unique circumstances but this might become more common as the overall use of CW talent continues to increase as a percentage of an organization’s overall workforce.

Other challenges. With these longer tenures come other talent resource management challenges. Take, for example, what could be called “organizational tribal knowledge retention.” With a median assignment length of 24 months, your CW talent resources have the potential to accumulate an impactful amount of organizational tribal knowledge, no matter how inconsequential the role. The more roles and lower your CW talent turnover, the greater the amount of tribal knowledge that is amassed by contingent talent resources.

The value enhancement of a CW engagement not affected by turnover is significant in terms of engagement quality, partner cost-effectiveness and value impact. If one gets this turnover management right with their CW service delivery partners, then enhanced margins will emerge for partners and potential savings emerge in the form of tenure discounts and other creative savings sharing initiatives. So when lengthening CW assignment limits, managers need to stay focused on lowering CW talent resource turnover. Done right for every CW engagement, it becomes a win-win engagement management for all.

But when the CW resources naturally  turn over, the program needs to consider how to retain the skills, knowledge, value and intellectual property/know-how (beyond legal protections). Maybe at some point during a CW assignment, the program office needs to conduct an assessment to determine whether the role(s) should be made a permanent staff position and potentially offered to the known, valuable contingent talent delivering the service.

With longer CW assignments, more organizational “tribal knowledge” management risks from a CW talent resource management perspective will naturally emerge. However, co-employment risk is not among them (previously articles have discussed ^[1] how tenure lengths are not a major factor in courts’ co-employment rulings). If you’re engaging specific CW talent over longer periods of time on an assignment, then new talent management issues will emerge and need to be addressed over the lifecycle of a CW engagement.