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What is Contingent Workforce: A Staffing Dictionary

Every industry has its jargon, and the staffing world isn’t immune. For newcomers in this space, making sense of the various industry terms and acronyms can be confusing. Acronyms can mean different things, and multiple names linked to a similar concept can confuse unfamiliar audiences. And if you were like me, you might have even found yourself replaying recordings of meetings to write down these terms, then searching for their meaning.


While it’s nearly impossible to standardize the staffing-industry lexicon, becoming familiar with the most commonly-used contingent workforce terms can help you gradually ease yourself into the vast sea of information. I know for sure, as a newcomer, I would have appreciated it.


Here is a fairly comprehensive list of industry terms and definitions. Bookmark it as a reference, or call us – we’re here to help educate you so you can make the best decision for your company.

Contingent Workforce Management Glossary

Staffing agency: A company that provides businesses with contingent staffing or recruitment services, including candidates.


Applicant/candidate: An individual applying for a job through a staffing firm or directly with the company.


Applicant tracking system (ATS): Software that helps companies identify, organize, and track candidates through the hiring process. It can also be referred to as a talent management system.


Blended workforce: A combination of various worker types or categories in an organization operating under different contracts. It is usually a mix of full- and part-time, consultants, freelancers, contractors, and temporary employees.


Pay rate: Contingent worker’s hourly pay.


Bill rate: Pay rate plus markups, which can include payroll, statutory, third-party provider fees, and other costs.


Markup: A percentage of the bill rate amounting to staffing agency fees for the services rendered.


Candidate relationship management: Strategies and processes that govern the interaction between businesses and their potential employees, alumni, or current staff.


Co-employment risk: A set of legal and financial risks arising due to the mismanagement of contingent workers.


Consolidated invoicing: The process of combining multiple invoices from different staffing suppliers into a single invoice, which makes it easier for companies to manage when issuing payments.


Contingent worker: Temporary or non-permanent workers who are hired for a period of time or on a per-project basis. Contingent workers can also be called freelancers, independent contractors, consultants, non-employees, extended, or outsourced or offshore personnel. None of these workers are permanent or direct employees of the business.


Contingent workforce program: The method by which a company sources, recruits, and manages its contingent workers.


Direct hire: A hire made directly by the company without the aid of a staffing agency.


Direct sourcing: The process of building talent pipelines using your organization’s existing internal talent pools companies can extend their reach by directly accessing other talent pools.


Employer of record (EOR): An organization that serves as a contingent worker’s official employer for tax and statutory responsibilities. EOR is inclusive of payrolling services.


Hiring manager: An individual from the company responsible for initiating a job requisition and defining the required qualifications for that particular job.


Job boards: Online platforms where jobs are advertised. Examples include LinkedIn, ZipRecruiter, CareerBuilder, Monster, Facebook, and Snagajob.


Job requisition: A formal initiation of a job request.


Job description: A formal document that lists the relevant skills and legal requirements for a particular job opening.


Managed service provider (MSP): A third-party service that helps businesses oversee their contingent workforce programs. By acting as an interface between businesses and their talent suppliers, MSPs facilitate end-to-end management of the entire contingent talent lifecycle.


Rogue spending/maverick spending: Expenditures in a contingent workforce program that exceed the pre-defined and negotiated contracts. Rogue spend is often unreported or untracked in budgets or misrepresented as SOW spend.


Onboarding: The process of integrating and introducing a new worker into the organization.


Offboarding: The process that governs the legal separation of a worker and the employer organization.


Recruitment process outsourcing (RPO): A form of business process outsourcing (BPO) where an employer transfers all or part of its recruitment processes to an external service provider.


Employee referral program: A talent acquisition strategy where businesses provide benefits (bonus pay, gifts) to current workers to recommend skilled candidates within their network.


Request for information (RFI): A formal document that asks workforce solutions providers to share an overview of their capabilities and company information. After approval, the solution provider enters into the request-for-proposal stage.


Request for proposal (RFP): A formal document that specifies in detail the solution provider’s company information, financial information, product capabilities, and customer references as part of the company’s bidding process.


Self-managed program: A contingent workforce program that is managed by the business with no external support.


Service level agreement(SLA): A formal document that specifies the work expectations the company requires from the service provider.


Candidate sourcing The process of searching and attracting potential candidates.


Spend management: The process of forecasting and budgeting money to be spent on a contingent workforce.


Staffing: The process of hiring contingent workers within an organization.


Staffing company/staffing agency/staffing firm: An external organization that provides staffing/recruiting services to a client.


Strategic workforce planning: An ongoing process that aims to anticipate and fulfill the current and future staffing needs of the organization.


Supplier management: The process of managing relationships between staffing solutions providers and businesses. Supplier performance management is an integral component, where staffing suppliers are assessed based on relevant key performance indicators (KPIs)


Talent acquisition: The process of identifying and attracting potential workers.


Talent management: The process that governs and manages the entire worker life cycle within a contingent workforce program.


Vendor management system (VMS): A cloud-based or web-based software platform that helps companies manage their contingent workforces end-to-end. A VMS increases visibility, automates processes, helps control spend; it can be managed by the company or the MSP.


Vendor-neutral approach: MSPs that have no preferred supplier list and that give their supplier base equal access to the company’s job postings.


Vendor-tiered approach: A process where MSPs send job openings to their supplier base in a static, tiered, and sequential manner, depending on the relationship between the MSP and the staffing supplier.


Now that you’re clearer about the terminologies, you’re ready to figure out how your company can better manage its contingent (or extended, non-employee, contract, freelance) workforce. Whether you’re looking for new contingent talent or searching for a workforce solutions partner to completely manage your programs, Prosperix’s array of workforce solutions has the answer for every challenge.


Let’s talk today to learn more about your workforce needs.

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