Remote and distributed workforces are the new normal, and many companies worldwide now engage contractors rather than hire full-time employees. While there are numerous benefits to engaging contractors, the billing and invoicing process has been complex—until recently.
Traditionally, managers exchange countless back-and-forth emails and phone calls to request and process invoices. Paying contractors is even more difficult when they reside in another state or country. HR, finance, and legal teams must exhaustively research local labor laws to ensure they compliantly pay their contractors. They also must overcome the challenges of currency exchange and new time zones when issuing payments to contractors abroad.
Now, to boost efficiency and ensure compliance, businesses turn to partners with the right mix of technology and expertise. Companies that work with these partners get access to automated payment systems that save time while increasing accuracy and efficiency.
There are numerous benefits to automating your contractor payments. Read on to discover the top four.
Benefit One: Time Savings
Many contractor payment solutions have an online invoicing and payment system connected to their software. This feature collects and stores important contractor data in an easy-to-use, cloud-based platform. With one central place to look for essential documents when questions arise about billing, teams eliminate hours of sorting through old emails or contacting contractors requesting necessary paperwork.
Companies also use automated technology to expedite invoicing and paying contractors. For example, when a business partners with Velocity Global, workers submit invoicing details in our proprietary technology. Then, managers simply log in to review and approve invoices with just a couple of clicks. After approval, Velocity Global pays the contractors on their company’s behalf, in their local currency.
Benefit Two: Increased Retention
Turning to an automated payments system doesn’t only save time for HR teams. It increases their ability to attract and retain the right workers.
Contractors that are paid on time and without error are more satisfied than those who deal with unreliable payments. As a result, consistent payments contribute to a better employee experience for your talent—and higher retention rates. That’s because companies with higher employee experience benchmarks have less turnover than those with lower benchmarks.
Hiring managers that deliver correct pay through an automated platform increase their appeal to contractors choosing between multiple assignment offers.
Benefit Three: Compliance Peace of Mind
Contractor payment laws can vary from country to country, creating a nightmare for HR and legal teams looking to maintain compliance and avoid fines.
When teams don’t have the time or expertise to understand market-specific rules, they risk running afoul of regulators. Noncompliance brings reputational damage, legal fees, audits, and fines. Companies that work with an experienced contractor payment partner significantly reduce their compliance payment-related risk. By working with Velocity Global, companies get access to a platform that helps them:
- Gain peace of mind that their contractor payment operations are compliant with local labor and payment laws
- Shift complicated contractor payment responsibilities away from internal HR and payroll departments
Benefit Four: Cost Savings
Time is money, and companies that work with an automated payments processing partner reduce costs by increasing the efficiency of their internal teams.
When teams that work with contractors don’t have to take on the burden of compliantly paying them across markets, they can devote full attention to their day-to-day tasks. Keeping your teams focused on their core responsibilities sets them up for success, so your company reaps the full benefits of their skills and expertise.
At the same time, companies that automate payments spend less time—and money—searching for new workers. Companies in the United States lose one trillion dollars on employee turnover each year.
While this figure does not account for contractors, the bottom line is that turnover is exceptionally costly for companies, and the hunt for talent is fierce. Considering the time required to recruit contractors, and the lost productivity that occurs when companies lack the skills they need to deliver on business goals, it’s clear that HR teams must do everything in their power to retain contractors. Delivering accurate, compliant payments does just that by giving contractors the peace of mind and consistency they expect.
Easily Manage Contractor Payments with Velocity Global
Automating payments transforms the way organizations manage and pay their contractors. Velocity Global’s Contractor Payments solution reduces time spent collecting data while mitigating the risk of making costly compliance mistakes. Companies that partner with Velocity Global scale and grow their business with ease, rather than diverting their internal resources to navigate complicated HR and payroll laws.
Ready to explore what Velocity Global’s Contractor Payments solution can do for your company? Reach out today to see how our tools benefit your business.