Benefits of a Centralized Contractors Solution for Enterprise
Alex Margolin| Nov 16, 2023
- The Gig Economy is growing, with 36% of employed Americans (58 million people) identifying as independent contractors, reflecting a shift towards flexibility over job stability.
- Enterprise organizations face challenges managing and paying large numbers of independent contractors including navigating local regulations, invoicing formats, and multiple currencies.
- Over-relying on independent contractors can risk misclassification, which can lead to fines and lawsuits.
- Papaya Global offers an all-in-one, enterprise-grade solution for contractors, providing cost-effective contractor management, clear legal contracts, standardized processes, and streamlined payments, all through one unified platform.
Not long ago, employment meant working regular hours at one particular company. Today, definitions are changing. A whopping 36% of employed Americans – 58 million people – identify as independent contractors, up from 27% in 2017.
In other words, more people are choosing flexibility over stability. For enterprise this means that virtually any short-term need – a special skill or a temporary personnel gap – can be addressed through the gig economy.
McKinsey recently reported on the impact of independent contractors on the employment landscape. “For organizations in competition for top performers and digital innovators, an understanding of how much flexibility their talent pool expects and demands is critical,” McKinsey noted.
What McKinsey doesn’t mention is the challenge of managing and paying hundreds or even thousands of independents across the globe – or the risks involved in relying too much on contractors.
That’s why companies need Papaya’s all-in-one, enterprise-grade solution for contractors, an essential part of our unified payroll and payments platform.
Papaya’s contractors solution provides the most comprehensive service at the lowest possible price – thanks to our centralized platform. Our solution combines advanced technology with expert support to provide solutions only Papaya can offer.
Read on to learn more.
Benefits, risks, and challenges in hiring contractors
Outsourcing projects to a wide range of independent contractors can be cost-effective. Contractors don’t receive health benefits, and you don’t pay payroll tax. They work on projects independently, without supervision, use their own equipment, and pay their own expenses.
Sometimes companies find that they need a particular expert in a specific region to contribute to a project on a one-time basis. Other times, companies find their workforce overloaded, such as during a particularly busy season, and they need short-term support.
In those cases and many more, the gig economy can offer the best solution. But there are numerous challenges. Employers must pay their contractors in compliance with local regulations, in their local currency, often with expensive cross-border payment delivery. Those laws and procedures vary widely, creating a massive organizational challenge.
Other risks and challenges include:
- Misclassification risk – Companies that exert too much control over contractors (more characteristic of an employee structure) might be more face fines, lawsuits, and loss to reputation due to employee misclassification. Governments are cracking down.
- Contractual clarity – Contracts with independent workers must be clear and comprehensive, especially on issues such as data security, intellectual property protection, and liability issues. They must comply with local regulations, which vary from country to country.
- Inconsistent invoicing formats – Invoices vary in every location and there is no standardization in bank formats and styles, creating a mismatch of data formats.
- Managing multiple currencies – Paying contractors in different currencies across the globe means managing FX fluctuations and monitoring conversion rates, which takes a great deal of time and effort.
- Different payment terms – Managing the unique demands of every contractor could be even more complicated than regular global payroll cycles.
Unified platform means lowest price – $2 per contractor
Papaya Global built the first payroll and payments platform on the market to solve all the complexities of global hiring, workforce management, and cross-border payment. Papaya’s platform is the first comprehensive system that is optimized for all types of payroll-related payments – including independent contractors.
Our unified platform allows us to charge the lowest price for contractor management and payments – because it’s all done through a single, unified process. You get both operations for the price of one!
Our contractor service provides:
- Best price – Our solution brings contractor management and payment together, so you get the lowest price possible – just $2 per month, per contractor.
- No misclassification – Our legal team reviews your contractor operations, ensuring proper classification. If any questions arise, we offer alternative solutions such as working with an Employer of Record (EOR).
- Contract drafting and review – Papaya’s in-house experts can advise on and draft the regulatory documents for contractor hiring, ensuring local compliance and risk mitigation.
- Platform automation – Our cloud-based platform standardizes the process around the globe so you can onboard, approve invoices, and pay in multiple currencies with full visibility from any location, while providing bank-level security.
- Streamlined payments – Our self-service payments solution is embedded in our platform, so you can automate the payments process – including currency management – reducing hours of manual payments management and reducing costs.
In addition, our unified platform support offers an enterprise-grade solution for all employment options – providing the flexibility you need. If you decide to hire a contractor as a regular payrolled employee, you can do so easily because all the data is already on the platform.
Experience the new standard for contractor management and payments
Papaya’s centralized and optimized solution brings contractor management and payments to a new standard. No more manual shuffling through stacks of invoices, stressing over questions of classification, or relying on standardized, inflexible contracts.
Learn more about how Papaya can save you money and transform your contractor operations. Schedule a demo today.