Working As Contract Staff is The New Future of Work

Working As Contract Staff is The New Future of Work

RISING PROPORTION OF TEMP AND CONTRACT STAFF IN THE WORK PLACE

Resident employees working as contract staff or term contracts are on the rise. According to data from the Ministry of Manpower (MOM), residents working as contract staff increased almost 9 per cent from 2010 to 2015, and currently number 202,400, or 11 per cent of the resident workforce in 2015. According to human resource consultancies, Hays and Randstad, an increasing proportion of open positions are for temporary and contract assignments.

Contracting will increasing become a trend in the future work place. 

Corporate tax professional Wong Foong Phing has been working on a part-time basis for the last nine years. Initially joining as full-time staff, she worked out a four-day week (Mondays to Thursdays) with her employer, PwC Singapore, after she got married.

“The main reason I’m choosing to work part-time is so that my family can spend more time together. My husband works from Sunday to Thursday, so being able to not work on Fridays aligns our day-offs. This means we can spend more time with our kids,” said Ms Wong.

Despite not being in a full-time, permanent role, the 36-year-old said that the compensation and benefits provided to her has been fair, and the part-time, open-ended arrangement has been greatly beneficial, helping her fulfill both “career and personal objectives”.

Ms Wong makes up a growing pool of Singaporeans going into less-traditional employment arrangements, sometimes by choice but not always. And while the flexible work arrangement has been a boon for a skilled PME (Professional, Manager, and Executive) like her, it may not work out as well for those on temporary or term contracts who may have less bargaining power, are potentially more vulnerable and may have other challenges to deal with.

It is this group of employees that the Manpower Ministry was targeting when it released guidelines on employment benefits – including paid leave entitlements – for contract staff last month.

“Based on regular conversations with companies across various sectors and their hiring requirements, we have observed an increase in the proportion of temporary and contract assignments out of vacancies available from around 5 per cent five years ago, to 15 to 20 per cent today,” said Ms Lynne Roeder, Managing Director, Hays Singapore.

“Contracting has picked up significantly heavily since late 2015″, said Ms Jaya Dass, Country Director of Randstad Singapore.

“Organisations have also become increasingly attracted to what can be referred to as a ‘try before you buy’ method,” said Ms Dass, explaining that this means organisations test out contractors to see how they perform before converting them to a permanent position.

BOTH WHITE-AND-BLUE COLLAR JOBS BEING CONTRACTED OUT

HR consultants say industries like IT, financial services, engineering, pharmaceuticals, and oil and gas, where businesses are structured heavily around projects, have the greatest propensity to use contract staff. But there is also increasing demand for contractors in blue collar professions.

Take food delivery services Deliveroo and foodpanda for example. Both companies told Channel NewsAsia that almost all of their delivery riders – which add up to more than 3,700 – are independent or third-party part-timers who are paid on an hourly basis, with a negligible proportion of full-time riders.

On top of the hourly rates, the riders also earn a bonus for each order, or docket. According to foodpanda, top-performing riders can make more than S$25 per hour on the weekend. In the intense competition to attract and retain quality manpower, foodpanda has been dangling perks, including weekly 5-aside football tournaments and monthly BBQs.

“We have also selected two of our top performing riders and sent them to the opening game of the Euro Championships in Paris, with all expenses covered by foodpanda to show our appreciation for their hard work,” said Managing Director Emma Heap.

THE CHANGING FUTURE OF WORK

According to 2014 PwC survey, almost of HR professionals expect that at least a fifth of their workforce will be made up of contractors or temporary workers by 2022.

As organisations become increasingly aware of the benefits of contracting, and candidates become more open to the concept of professional contract work, initiatives to protect the rights and benefits – such as the recent MOM guidelines – will become increasingly pertinent.

While the MOM guidelines are not legally enforceable for now, Mr Zainal Sapari, assistant secretary-general of the National Trades Union Congress has said that legislation is on the cards if moral suasion fails. He said in a Facebook post last month that the guidelines aim to prevent fixed-term employees from being “short-changed by unscrupulous employers”.

Generally, employment agencies in Singapore and recruitment experts say employees on term contracts miss out on benefits which permanent staff are entitled to, including employer CPF contributions, medical insurance, and union support.

And unlike mature contract markets, the pay for contract staff in Singapore is at most on par with permanent employees, making the employment arrangement a less attractive option.

“As opposed to other countries such as Australia, the UK and the US, where contractors may receive a premium for taking up a contract role, this is less the case in Singapore and Asia as a whole,” said Ms Roeder.

Beyond material benefits and financial remuneration, contract and temp employees will be increasingly cognisant of professional development opportunities within these roles.

“The biggest drawbacks from contracting, due to the shorter nature of the work, revolve around the lack of being able to influence big changes and ideas within the company and its business, something that could impact the strength of the candidate’s resume in the long run,” said Randstad’s Ms Dass.

“Supported by the technology and social media as well as the rise of the portfolio career, more and more workers come to realise that they could enjoy more flexibility and varied challenges by working freelance or as a contractor for multiple organisations,” said Mr Martijn Schouten, Director of People & Organisation, PwC South East Asian Consulting.

“It’s a trend that public and private sector need to prepare for.”

Source: Channel NewsAsia contract staff

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