Contract Labor via On-Demand App

Apr 2, 2020

how apps help businesses contract labor

The labor market has greatly evolved in the past few years. Thanks to the advent of online businesses and recruitment platforms, employers and the workforce have more opportunities than ever to engage in contract labor via on-demand apps. Not long ago, filling urgent vacancies and unexpected worker needs, was no less than a hassle for employers. Similarly, temporary or short-term workers (independent contractors) had trouble finding good income jobs. Today, on-demand staffing apps are here to solve these age-old staffing problems.

Understanding Contract Labor Via On-Demand Apps

A plethora of on-demand staffing apps are available on the internet now which allow employers to quickly fill different job roles for temporary projects or gigs. Hence, hiring independent contractors has become super easy and economical; also, you no longer have to get full-time employees.

On-demand apps allow employees or independent contractors to avoid the complications of written contracts of employment and long-term commitments. Hence, hiring an independent contractor is the best option. Especially when businesses need workers for special events, require expert workers with specialized skills to handle specific tasks or when there is an unexpected increase in production demand.

With the emerging human resource management mobile apps, all employers have to do is enter the job description and project details, and then wait for the job seekers to apply. So, now to hire an employee for temporary work you only require a mobile phone and a reliable on-demand staffing app.

How Gig Economy is Helping Contract Labor

Gig economy (also known as platform economy) is a new labor market that promotes short-term jobs through online/digital marketplaces. It stands for the gig, hourly or project-based tasks that are different from the standard terms of employment. Moreover, the gig economy operates through digital labor platforms – the most common being on-demand apps. Hence, as the gig economy grows, the demand for contract labor will grow as well.

Gig economy comprises two major types of labor roles: crowd work and work on demand via apps. In crowd work, business owners hire professionals online who work remotely such as software development, graphic designing, data entry, writing services, etc. Examples of some crowd work platforms include People per Hour, Fiverr, Upwork, Freelancer, etc.

The only shortcoming of such an arrangement between a contractor and an employee is that it becomes difficult to assess whether the business relationship is autonomous or subordinate. This is because an independent contractor who is self-employed does not have access to rights given to a permanent worker in a ‘subordinated’ employment relationship. For example, health insurance, workers’ compensation, social security, and medicare.

Since there are no proper laws or rules for online hired contracts, the breach of contract in online or remote job arrangements is not very risky. Thus, wrongful termination of online or freelancer workers is not a common problem.

Whereas working on-demand via apps, allow the organization and worker to meet digitally but the work is performed locally. Examples of such jobs include food delivery, transportation, home services, tuition, etc. Major platforms of on-demand work are Uber (transportation) and Foodpanda (food delivery).

Advantages of On-Demand Apps

Here are some advantages of on-demand apps for your business:

  • Efficiency

On-demand apps allow you to hire skilled and experienced professionals quickly and easily. This is a major difference between an independent worker’s recruitment and a permanent worker. Hiring a long-term employee takes weeks or even months of gathering, filtering, calling, and interviewing the applicants. However, with a user-friendly app, you can quickly select the desired worker and hire him or her instantly!

  • Affordability

One great advantage of hiring contingent workers through on-demand apps is that it is a more affordable option as there are little to no hiring costs. Moreover, temporary workers are not eligible for full-time employee benefits like health care, social security, transportation costs, pension funds, etc. They are however employees of the business hence salaries are included in the estimation of business tax and the estimated tax payment of the business decreases. All in all, the business has to face low costs and keeps it simple with the internal revenue service.

  • Cashless Payment Facility

With so many payment options available to us now, the on-demand apps also include various payment options for the users. Hence, employers can make payment in a fast and straightforward way depending upon which option they select.

  • Rating and Review

A very useful feature of on-demand apps is the rating and review option where both employers and employees rate their experience. The service provider gets feedback on their image in the market. This helps businesses in choosing the top-of-the-line talent with positive reviews and high ratings, as well as gives contractors an idea of the culture in a company they’re selecting to work for.

  • Pool of Talent

In terms of hiring labor through on-demand apps, businesses have a high degree of control over the type of worker they are looking for. Such apps are filled with well-qualified and skilled job seekers, hence, the employer has a wide pool of talent to choose from. They don’t have to comprise as they can easily find exactly who they’re looking for no matter what the criterion is – skill, work experience, educational background, etc.

Challenges of Labor On-Demand Apps

Even though On-demand apps can prove to be very fruitful for businesses, here are some challenges that come with it:

Business model – The need for one single app to fit different business models is challenging. Hence, more and more on-demand apps are integrating various types of labor categories to meet the standards of different business models.

Customer experience – This sector of apps, still needs to perfect itself to satisfy the customers i.e., both employers and employees.

Regulations – Startups need to keep some regulations in mind with their on-demand workforce. They should know how employment laws affect this sector of the labor market.

Future of On-Demand apps

Businesses that are trying to approach the on-demand workforce and make most of the gig economy, need to be clear about their business plan. One thing is clear: On-demand labor is here to stay and it is the future. The evolution of gig culture and contingent workers is shaping new consumer trends. Hence, businesses need to keep up with it to stay ahead of their competition.

A Reliable on Demand App – ShiftPixy

ShiftPixy is one of the best staffing applications which match jobs with independent contractors. Thus, ShiftPixy supplies labor on-demand to well-reputed businesses looking for a gig or shift workers.

Whether you are in San Francisco California, Orlando Florida, anywhere in Texas or New York – and anywhere in between, you can find professional workers for different kinds of temporary jobs. For example, you can hire apartment cleaners, personal assistants, food delivery guys, drivers, etc. – even grocery shoppers!

On-demand apps are offering efficient and effective staffing services to both small and large-scale businesses. Being able to hire top talent with a few clicks is a great privilege and comes with many benefits. The current labor market has new open doors and opportunities for all types of job openings on a contractual basis. To conclude, both contract labor and on-demand apps are codependent and as long as any one of the two exits, they will continue to grow.

Ready to find out how your business can engage and compete in the new labor era? Learn more here!