Contingent Workforce Management: A Simplified Wordbook

contingent workforce management glossary

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.


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.


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. 


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


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.


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.

How Technology is Transforming Contingent Workforce Management

contingent workforce trends 2022

For any business that believed it was resilient to change, the pandemic was a loud, unexpected wake up call. Whether or not it was a rude one, the jolt encouraged every company to take a closer look at making work and workforces agile and resilient. Better candidates need to be hired faster, working styles have to become more flexible, greater productivity and efficiencies need to be achieved. 

And so, one big question looms – “What’s to be done?” While the answer seems straightforward (embracing technology), companies are struggling to bridge the gap between meeting worker needs and increasing automation. While the goal of optimizing workforce management through technology can seem unattainable to both growing and established organizations, it’s far from impossible. Let us tell you how, whether you’re gathering resources to implement new technology or trying to improve your company’s technology adoption and change-management success.

Workforce management technology – A compelling investment?

Not too long ago, companies began to realize that investing in technology was key for development. As workforces grew and change became inevitable, manual program management turned out to be untenable, especially for large entities. As workforces are changing, so is workforce management, but companies often fail to keep pace.

The 2022 State of the U.S. Workforce survey from TCP Software Solutions suggests the move to advanced workforce management technology is slow, yet welcome. The survey found that 58% of businesses rely on handling their workforce’s data manually through emails and spreadsheets or through basic digital tools even today. In a landscape impacted by Covid-19, where about 45% of the American workforce prefers a hybrid working style, this approach seems less than ideal. The silver lining is that 72% of businesses are adopting HR and workforce management technologies by increasing budgets; 52% of those see value in incorporating cloud technology to automate tasks, improve communication, and expedite decision-making. 

While technology can simplify and streamline workforce management, barriers to adoption can stand in the way. Limited technological competence, lack of funds, or difficulty in finding the right tools to fit specific needs can be real challenges. Companies will be able to confidently forge ahead with investments in technology when they concentrate on their biggest and most powerful component – people.

The present – and future – are all about people

For organizations to identify the best ways to handle workforce processes, they must start by understanding the actors that affect them. According to a 2022 research report from The Josh Bersin Company, companies should pay attention to nine key trends to be successful in workforce management:

  • The current economy is reinventing and redefining work
  • Technology is one of the main facilitators of hybrid working
  • Executives are driven by a learning and upskilling-centric mentality 
  • Talent marketplaces are the not-so-secret staffing weapon of every business
  • Employee experience is everything
  • Workforce diversity is expanding to include equity, inclusion, and belonging
  • People analytics is at the core of every business function
  • Updating HR capabilities isn’t an option, it’s a necessity
  • The CHRO’s role is more important now than ever

It’s clear that the common thread benefiting companies is to focus less on the business angle and more on the human one. The Bersin report pointed out a common thread across studies from 2020-2022: “Listening to employees is one of the most valuable management practices we have.” 

The importance of technology in contingent workforce management

A new world of talent acquisition, engagement, and management is here, one in which data around workers and their experiences should be inextricably tied to every decision we make. And the trends we’ve discussed aren’t applicable only to companies with full-time workforces. In industries where contingent workforce solutions are present, talent-tracking and performance-management platforms are essentials.  

Whether programs are managed by an MSP or internally, visibility into the details is key. A major benefit of using an MSP is its ability to promote visibility into key performance indicators, compliance, spend management, and productivity (of suppliers and workers). Tracking personnel records and monitoring output are best handled by people-centric solutions like vendor management systems (VMS). 

Data-based: A complete workforce management solution

Comprehensive workforce management solutions are most effective when they are dynamic and scalable. In today’s unpredictable economy, changes to business strategies, particularly around employment, need elasticity and the capacity to accommodate unexpected, sudden shifts. Modern workforce management technologies that rely on data and actionable insights provide a heightened ability to predict and forecast. They enable companies to know specific details like how many workers will be needed at a given time, what skills and pay rates will be required, and which suppliers can provide the best talent.  

Data represented as metrics, business intelligence, transparency, and benchmarks allow businesses to predict future needs and counter potential fluctuations in the market or within the organization. Yet, to be meaningful, data must be interpreted and curated. Many growing businesses don’t have the time or staff to manage programs and analyze data, even with legacy technology solutions in place. 

That’s why you need an end-to-end  solution that combines vendor management, AI-powered vetting technology, applicant tracking functionalities, and a powerful performance management dashboard: Prosperix VMS Network. 

Welcome to the future of contingent workforce management.

Exponential Technologies: Driving the Future of Contingent Workforce Management

Today, change is exponential. Its impact touches everything and everyone, and its momentum is propelling us forward at a dizzying pace. Like every industry, the contingent workforce space is also encountering new dynamics, shifts, and challenges as exponential change continues to redefine the meaning of work. But, dealing with this change in the right way can help businesses turn crises into opportunities.


In our recent webinar, Developing Your Talent Strategy with Prosperix Xponential, we delved into how exponential change is impacting companies’ workforce management strategies and how to meet that change with an exponential solution.

Let’s explore —

Most contingent workforce programs don’t become best in class – why?

Contingent workforce management is difficult to manage. Talent shortages, rogue spend, lack of program visibility and real-time insights, compliance risks, and supplier management troubles are common issues businesses face while establishing and managing their programs. This makes fulfilling basic program requirements challenging, let alone figuring out how to thrive. Why? Because most companies don’t realize these challenges are tied to exponential change.


Exponential change isn’t exclusively the byproduct of rapidly-evolving technology. It’s happening because of emerging shifts in demographics, the environment, the economy, and borderless commerce. And with the increasing frequency of these changes, attempting to prepare for each transformative circumstance is a daunting task.

This is why legacy MSP/VMS solutions fail

Legacy systems are singular solutions designed to solve a single problem. They don’t consider the complexities and risks involved in contingent workforce management, then reactively adjust to fix the immediate challenge.

Talent supplier management is a significant area where these systems fail.

In traditionally structured programs, businesses on board suppliers with the presumption that they would be best suited to fulfill their hiring needs. But, placing a blind bet on supplier partnerships isn’t always favorable for contingent workforce programs. And, when you have no performance measurement capabilities or only a posthumous evaluation of supplier performance, you put yourself at risk. 

The staffing industry is highly volatile, and supplier capabilities can change instantly. Recruiters are headhunted by competing organizations all the time, and the one fulfilling your job requests today might not be available tomorrow. This invariably affects supplier performance, and because you lack real-time visibility into how your programs are performing, it can lead to:- 

  • higher costs
  • poor hiring experiences
  • non-standard contract terms
  • compliance risks
  • constant change management
  • lack of program adoption
  • failure to achieve program maturity

Ultimately, this static method of managing your supplier base disadvantages all the stakeholders involved. Business productivity decreases due to the lack of quality talent, candidates suffer from poor experiences, procurement teams are overwhelmed with the looming costs, and suppliers remain stagnant due to the lack of feedback on their performances. 

An exponential contingent workforce solution is the solution

Unlike linear solutions that solve only a portion of the problem, exponential solutions are built to effectively manage the entire contingent workforce ecosystem. This means, in addition to solving anticipated risks and disruptions, these solutions incorporate the best interests of every stakeholder involved.

They deliver:

Agility – Exponential solutions allow you to remain agile in every workforce situation. Whether it’s scaling up your workforce due to your company acquiring a new business unit or a new diversity initiative that requires more suppliers, exponential solutions have the ability to fulfill every workforce need IMMEDIATELY. 

Resilience – In situations where companies have to re-evaluate their contingency plans, exponential solutions help optimize contingent workforce programs. They provide complete visibility into your program health and help you identify the best ways for cost containment to remain resilient. 

Network effects – Exponential solutions allow you to access a diverse network of suppliers, giving you unlimited talent pools with candidates from various geographies and with skill sets. The power of network effects gives you the exponential ability to scale your workforce, and this single solution takes care of your business’s total talent needs. 

Automation – By uniting the entire workforce ecosystem and using the latest technologies, exponential workforce solutions help automate the day-to-day tasks involved in contingent workforce management. They streamline processes and make them lean, elastic, and agile, fostering transparent communication among stakeholders.

Real-time data visibility and insights – Exponential workforce solutions are intelligent and data-driven. They govern contingent workforce programs using real-time data and help you make strategic decisions depending on data forecasts. Real-time data also feeds intelligent algorithms that keep your program running optimally in all situations. 

Prosperix Xponential – solving contingent workforce management end-to-end

Built with exponential capabilities, Prosperix Xponential is a bundled solution that helps businesses manage their entire hiring lifecycles. Our exponential offering consists of:

Prosperix VMS Network – The world’s only networked (and patent-pending) VMS with a built-in hiring marketplace capable of automating the functional aspects of contingent workforce management. Our stand-out functionality — automated supplier management helps manage suppliers effectively while building and managing your contingent workforce with the highest-quality candidates in the market.

Prosperix Hiring Marketplace – Our proprietary built-in hiring marketplace accommodates your incumbents while giving you access to a diverse range of suppliers capable of filling every job in the market. We give suppliers democratized access to jobs on our platform, and this dramatically improves the quality of hires and reduces costs.

MSP Services – Seasoned MSP expertise to guide every step of your workforce management, from candidate curation and selection to onboarding and compliance management. With Prosperix, you can simplify your contingent workforce program with one contract, invoice, and point-of-contact to handle all supplier relationships.

Payrolling – Our payroll and employer-of record (EOR) services take care of payroll, statutory requirements, workers compensation insurance, employee benefits, background checks, and more across all worker categories. 

10x your capabilities with Prosperix Xponential.

Watch the webinar here, then let’s talk! 

Checklist: Five Questions to Ask About Your Staffing Managed Service Provider

checklist for staffing managed service provider

The right managed service provider (MSP) can help you achieve an efficient, effective contingent workforce program, but making the choice can be tricky.

Hiring organizations looking for the right MSP partner can find themselves overwhelmed and confused. So before you begin your search for a new – or replacement – solution provider, we recommend you examine their core functionality to truly understand whether they deliver on their claims.

Here are some important questions to ask. 

1. Can the managed service provider help you source the right talent?

To source the right talent, you need the right suppliers. But,  many MSP providers prefer vendor optimization, which often means limiting the number of suppliers you work with. While it may seem easier to build and manage relationships with a limited number of suppliers, it limits your access to the right talent pools. You may miss out on things like specific skill sets, making it more difficult to land the best candidates.

Look for managed service providers that have partnerships with a large number of reputable staffing suppliers that, in turn, have access to diverse talent pools (skills sets, geographies, certifications, etc.). This ensures you can quickly fill open jobs and plan for future hiring needs while significantly reducing your time to hire. Also, with access to wider talent pools, you’re more likely to find higher-quality candidates, ultimately improving your workforce quality.

A great example of solutions that operate using this idea are networked vendor management systems with a built-in hiring marketplace. These platforms give you access to a wide range of suppliers that cover various skill sets, geographies, niche job categories, and more. This way, you can be sure you’re not restricting your ability to tap into the best talent.

2. How important is candidate experience?

Very. Negative candidate experiences can damage your overall business reputation. Dissatisfied applicants are more likely to leave negative reviews on employer review sites like Glassdoor and Indeed, potentially deterring other candidates from applying to your organization. So, it is crucial to tend to the hiring experience for all your talent, whether full-time or contingent.

Part of delivering a positive candidate experience means including the candidate in every step of the hiring process. And this is possible only with a streamlined hiring solution. Without this, you risk creating a lengthy hiring process and communication gaps with your candidates, which can translate into decreased candidate engagement, negatively affecting the quality of your workforce down the road. 

Your MSP provider should have a streamlined hiring process that is candidate-focused and includes direct interview scheduling and feedback-sharing capabilities. By having frequent and meaningful touchpoints with your candidates, you foster a positive candidate experience which equates to better overall candidate experiences.

3. How quick is the VMS implementation time?

Faster time-to-value is an important consideration in any VMS implementation process. But, no two businesses have the same set of staffing problems to solve, which makes each VMS implementation unique.

Look for solution providers willing to collaborate with your internal stakeholders to identify areas needing special attention and refinement in the VMS configuration process. They should also facilitate the data migration of your incumbent supplier base into the new VMS.  

While evaluating the implementation process, consider examining the associated costs and recurring charges, as many staffing solutions on the market come with a minimum spend required to gain access to their comprehensive solution. And if they require you to use their IT teams to make all platform changes and subscribe for customer service, that can slow your processes and costs substantially more.

4. What is their pricing strategy?

Traditional staffing MSPs don’t charge businesses. Instead, they monetize their supply base. The suppliers, in turn, must pay MSPs to access their client programs. The issue with these supplier-funded MSPs is that they deter high-quality suppliers that don’t need access to an MSP’s client base. This means the top players with excellent customer service and quality outcomes normally don’t join MSP programs. Additionally, these models also discourage emerging industry players — often the pioneers of innovation.

To support the innovation you deserve for your long-term program success, look beyond the traditional pricing model.

5. Is their VMS technologically advanced?

Digital transformation is disrupting every area of business, and for a highly efficient and agile contingent workforce program, it makes sense to explore the latest technological advancements.

Cloud-based solutions tend to offer more innovation when compared to on-premise software solutions. And they come with an array of benefits — reduced implementation time, easier onboarding, lowered costs, robust upgrades and updates, and streamlined maintenance. Because these solutions are cloud-based, multiple clients can benefit from the solution’s functionalities while keeping each client’s data separate and secure.

Another advancement in the staffing arena is the use of AI to automate and boost hiring processes. For example, AI-based dynamic job distribution technology matches job requisitions at both the supplier and candidate levels, optimizing supplier performance and guaranteeing you the fastest access to the best candidates.

Modern solutions also help integrate candidate onboarding, meaning all candidate-related processes are executed on a single platform. They enable hiring managers to monitor candidates at every stage of the hiring pipeline, driving candidate visibility, increasing engagement, and equipping you with data-based insights on your suppliers’ activity.

The future of hiring and staffing vendor management

Prosperix checks all the boxes of an enterprise-grade cloud-based staffing solution and helps your business boost efficiency, compliance, and cost savings by enhancing your spend visibility. 

By choosing us, you benefit from the world’s only VMS network that includes FREE access to our integrated hiring marketplace, which provides immediate access to vetted talent suppliers that can fill your talent needs with the market’s best talent. The best part — our versatile solution can act as your managed service provider or support your in-house MSP with absolutely no initiation costs.

Curious to know more about how Prosperix’s solution can revolutionize your contingent workforce program?