4 reasons to automate independent contractor management

During crunch times and even normal business operations, managers often need relief—they need help in the form of additional workers. Independent contractors (ICs) can offer that relief, but finding, onboarding and overseeing the administration of ICs can be tedious work. 

Anyone who makes workforce decisions spends a lot of time, energy and money completing administrative tasks such as contracts and other documentation when utilizing ICs in their workforce. Some believe automation, or the use of machines and software to enable automatic processes, can save a business up to $4 million each year. That’s big money, no matter which industry you work in. 

Transportation, for example, is one industry facing especially difficult challenges that could be eased by automation. With a looming shortage of contracted drivers and a constant need for the same, these companies regularly engage in the arduous process of seeking qualified individuals with appropriate licenses, certifications, insurances, and more. Many hours are devoted solely to administering the onboarding process, taking time away from other objectives. Even worse, if an IC who isn’t qualified or insured falls through the cracks or ends up misclassified as an employee, it can expose a company to increased risk of liability and litigation. 

Technology is the answer

Very few solutions to complex problems are ever simple or easy. The solution to this one, however, is at least relatively straightforward: Replace manual processes—the repetitive administrative tasks mentioned previously—with advanced technology that frees up resources for other things. Automating routine administrative tasks related to onboarding and administrative burden of contracting ICs allows contracting companies to benefit from modern innovation and embed tremendous new efficiencies into their workflows. 

With the demands of doing business in today’s increasingly mobile digital economy, organizations must adapt to automation. Utilizing new technology to streamline these processes will enable good decision-making at a faster pace than ever before. 

More specifically, it can provide a complete solution in the following four key areas: 

1. Pre-qualifying prospective contractors 
2. Insurance verification and premiums 
3. Contractor settlements and deductions 
4. Integration and logistics 

With one system maintaining each of these areas, contracting companies will gain significant savings—significant enough to make the investment of upgrading seem inconsequential compared to the value gained from an automated system.

1. Pre-qualifying prospective contractors 

A customized and integrated pre-qualifying process reduces the amount of time spent finding people who have the necessary skills and qualifications. With a platform like the one designed and implemented by Openforce, prospective contractors respond directly to an online recruitment ad and begin the pre-qualification process from there. 

That platform, which features a complete suite of integrated pre-qualifying software, confirms an IC’s identity, ensures collection and submittal of the proper documentation, and handles the signing and background screening based on your requirements. 

Advanced automation eliminates the need for hours of sifting through paperwork, insurance documents, licenses and permits, not to mention conducting reference checks. With customizable preferences of managed services, the system can verify compliance and provide reassurance that the IC’s qualifications meet the business’s needs. 

2. Insurance verification and premiums

Many companies carry worker’s compensation, commercial or liability insurance. However, since ICs are classified differently, they may not be covered under the same policies. Consequently, there is often a gap where neither the company nor the IC is protected by a company’s insurance. The IC is at risk because the policy only covers employees, and the company is at risk because uninsured contract workers create liability. 

An automated process can verify and track insurance coverage for the IC, which is critical for compliance and to make sure everyone has the coverage they need. Openforce even connects your ICs to a full suite of affordable insurances through ICM Insurance Services, LLC, a licensed broker and wholly owned subsidiary of Openforce. On top of that, this powerful platform provides coverage in arrears and automatically deducts premiums from IC settlements to ensure that coverage doesn’t lapse, protecting contracting companies and ICs alike. 

Required insurances vary from state to state. Having a trusted partner who can advise on the appropriate policies eliminates any doubt that ICs have the correct policy and insurance coverage, which means peace of mind for everyone. 

3. Contractor settlements and deductions

Automating IC settlements is the simplest way to make compensation error- and hassle-free. With a secure and reliable system, companies can process settlements without the human component of manual calculations and paperwork. 

Instead of painstaking hours of accounting and time sheet crunch before settlement day, an automated system does all the work, efficiently and accurately. Settlements are secured, verified and viewable online, increasing the ICs’ sense of security, satisfaction and retention levels. 

4. Integration and logistics

One of the most inefficient tasks in contracting with a new driver is the cumbersome process of manually entering information into the dispatch system. This bottleneck slows down the process of getting the contracted driver up to speed. It also affects deliveries and ultimately the company’s service objectives. 

A state-of-the-art system can link the management platform to the dispatch system. Whenever a driver is contracted, the system instantly creates a contracted driver record in the dispatch system and shares that with the management platform. 

Sharing data between online documents created eliminates extra manual steps, which reduces the potential for errors and increases each contracted driver’s availability to be dispatched right away. This cloud-based operation empowers everyone in the process to complete tasks quickly and efficiently. 

Get help from Openforce

Openforce stands out from other companies with similar systems because we offer solutions to all the problems mentioned above in a single, easy-to-use IC workforce management platform. We specialize in simplifying the process for industries that demand qualified independent contractors, and our experienced staff and robust technology help companies reduce administrative burdens and legal risks. 

For nearly two decades, Openforce has worked with more than 60,000 companies and contractors for efficient vetting, verification, onboarding, settlement processing and dispatching. Our sophisticated technology platform and suite of managed services streamline the process with quick and reliable automation. 

By leveraging new technology to replace outdated manual processes, Openforce helps companies save time and money while achieving greater results and more sustainable growth. As a result, working with ICs has never been easier.