By HR Brew Staff
less than 3 min read
Definition:
The contingent workforce is descriptive of non-permanent workers who do not have ongoing employment contracts. It comprises freelancers, independent contractors, and temporary workers across all industries, though they are most commonly employed in the education and health services sector.
What differences exist in the employment of contingent workers?
Not only is the duration of their employment temporary, or specific to a project or season, but contingent workers are also paid on an hourly or project basis and do not receive benefits. Employees, on the other hand, are salaried and eligible for benefits including healthcare, retirement, and paid time off.
What are the benefits associated with employing a contingent workforce?
Organizations that employ workers on an as-needed basis may find that they are more agile and flexible, allowing them to meet the demands of specific projects or busy seasons. And because employers are not required to extend benefits to contingent workers, they may also see labor-related savings.
What are the challenges associated with employing a contingent workforce?
One of the biggest challenges associated with employing a contingent workforce may very well be compliance, specifically as it relates to worker classification. It is an employer’s responsibility to determine under the Fair Labor Standards Act (FLSA) whether a worker is an employee, and misclassification may result in legal and financial penalties. Other challenges may include those related to assessing, engaging, and managing non-permanent workers.
Can you put contingent workforce into context?
“The US faces a labor shortage that’s only expected to worsen. As recruiting and retaining top talent becomes increasingly challenging, employers may consider filling the gaps with contingent workers,” HR Brew reported in April 2025.
