Learn how to find the best contractor for a job and use the template for it.

How to Mitigate Risks When Hiring Freelancers and Contractors

Both contractors and freelancers are self-employed individuals who function as their own businesses. These professionals maintain total freedom over how they get the work done. Seasoned contractors and freelancers have years of experience across multiple organizations. They are used to jumping across various projects and are advantageous to the business regarding the flexibility, expertise, and cost-saving.

So, what's the problem?

A freelancer is
a self-employed individual who is not necessarily committed to a particular employer long-term. He/she can work with multiple clients at any given time. The clients are usually charged by the hour, day, or project; freelancers also generally work offsite. The flexible talent can work any hours, any day, from anywhere, having agreed on specific deadlines, but you don't know straight away if you got lucky.

A contractor is
a person that undertakes a contract to provide materials or labor to perform a service or do a job. Generally, he/she works with one client at a time, on location with the client team. Generally, they are still not entirely committed to a particular employer, but do care about their own reputation. Contractors are hired for jobs that can't be done internally in time or there's no reason to hire someone full time for a one-time job.

What are the risks?

In this day and age, project team management has become a bigger challenge than before. With endless working opportunities and the possibility for many professionals to work virtually, serious problems appear.

One of the most often reported problems is "ghosting". This phenomenon involves investing time in recruiting, interviewing, onboarding, and training new resources to work with your company or on your project. Then, after a day or two of working together, the hired person suddenly disappears. Among the other problems is the leak of information, delayed project delivery, misunderstanding of requirements.

If you have faced some of these situations, or you simply would like to protect yourself, we have some tips that might help with your freelancer/contractor.

Risks when hiring a freelancer

When you need to staff a project or a startup, or your company collaborates with freelancers and independent contractors, you will probably have to perform the role of HR and recruitment specialist, even if you are not.

In this case you need to be ready for the following:

Gaps in collaboration and communication;

Law-protected document storage and access;

Equipment issues;

Security issues;

Lack of training and development;

Ghosting;

Late project or product delivery;

Project failure.

Knowing why these problems arise and how to prevent them will help you with successful remote or distributed team building.

How to mitigate the risks of having a freelance/contract worker?

1. Provide clear policies

These policies should outline all the potential risks that a freelancer may face and as well as information on how to avoid or minimize these risks. A good policy should at least contain information on company culture, internal rules, project purpose, and scope. The company procedures and employee responsibilities have to be defined clearly. Depending on the size of the company, a policy can include an unlimited number of points, including dress code, attendance, benefits, health, and safety, etc.

2. Ensure strong security measures

Make sure that your security level is sufficient enough, and you have such protection measures for laptops and computers as full disk encryption, malicious software protection, VPN, firewall, content filtering, strong authentication and authorization measures, patching, and monitoring. Once the project is completed, don't forget to change all the passwords and access rules. Exclude unnecessary participants from the project chats, workspaces, emails, etc. Transform this all into a habit.

3. Get a written and signed contract

Starting a new project, you always have to invest your time and effort into the process freelancer and contractor search. High-level specialists are always hard to find, so be patient. But even if you are short on available resources, and need to find the candidate as soon as possible, never skip the step of contract signing. It is essential to state that all the work product belongs to you and cannot be used in any other way, pending legal consequences. The best way to ensure safety is to have them sign a non-disclosure contract.

4. Conduct background checks

When interviewing and hiring, don't forget to conduct a background check or get a reference from the previous project. If this is not possible, try to select the candidates with the highest feedback rate or the most recommended ones. Remember, it is always better to check twice even when you think you are 100% sure.

5. Close the loop in communication

It is essential to understand how your team and business can handle internal and external communication when freelancers and or contractors are in action.

A lot depends on how you, as a manager, will organize the teamwork process. Provide detailed and documented explanations of project tasks. Identify the key goals of the project, define deadlines, and deliverables. It is highly recommended to set up convenient video conversations scheduled regularly, and training sessions via conference calls or other means. Make sure that you keep all the communication lines open and are available when your freelancer has any questions.

6. Provide training

It does not matter how experienced is the freelancer or contractor that you hire; he/she should be trained according to your project needs. Training will show that they are valued as people and professionals. A structured training will minimize the risk of errors later in the project.

7. Build a collaborative culture

Provide open communication lines – ensure that every employee, contractor or freelancer is available when needed. Set up the weekly/daily meetings and standups to cross-check the status. Encourage employees to perform at their best. Provide feedback, be approachable and positive. You can expect a positive attitude in return if you treat and coach your team members accordingly. The more pleasant communication environment you will nurture, the more transparent the work in a project will become.

8. Plan work schedule

Every team member must understand the roles of everyone else, including responsibilities, and deadlines. Unprofessional team management can ruin the whole project, so it is essential to pay attention to its organization. Selecting a proper team and project management tool will help you to deal with this issue, building open communication within the team, and preventing misunderstandings. Use a team calendar – make sure that the employees submit their efforts and project progress reports on time. Build a conflict management plan – at least just to have it in case you suddenly need it.

9. Use the right management tool

Often it is possible to combine most of the points in one with just the right project management tool. Depending on your team size, project type, and specifics, choose the one the suits your needs. We, of course, encourage you to try Infolio for tracking employee hiring process, or onboarding; for contactor and freelancer management, for different kinds of project planning. It is easy to collaborate within distributed and remote teams when you have everything in one place.

Taking simple steps above will go a very long way to protecting your business, your proprietary information, and providing you peace of mind while enabling you to hire contract and freelance workers.

If you are building a remote team,

try our Contractor/ freelancer management template.

It shows how you could arrange remote candidate sourcing, evaluation, and hiring activities, so you don't have to start from scratch.

How to use this template?

Create a new project and choose the Contractor/ freelancer management template to start. All Infolio templates include some demo content. Feel free to remove it once you've got the idea.

Create a task for each freelancer/ contractor and group them by Lists – their potential working departments, e.g., "IT and Development", "Marketing and Sales", "Design and Media". Don't hesitate to remove the examples and add your lists with just a few clicks.

Switch to the Status view to track the candidate hiring process from screening to contract offers, e.g., "In review", "Contacted", "Interview scheduled", "Awaiting feedback", "Contract declined", "Contract accepted" etc. In this view, you can easily add new statuses to your workflow or rearrange existing ones. Update the status of any task by dragging and dropping it to the corresponding column.

Switch to the Table view, to add any additional information, and see it at a glance, e.g., candidate contract type, portfolio examples, LinkedIn profile, contact details, and much more. See which candidates accepted the job offer and are already working. Add custom fields if needed to further tailor the workflow to your needs.

To see how responsibilities are distributed within your recruitment team, group the project by Assignee. In this view, you can reassign tasks quickly by dragging and dropping them between columns.