Platt Perspective on Business and Technology

Exceptions and exception handling from the HR perspective 2: outside consultants and contract workers 1

Posted in HR and personnel by Timothy Platt on February 23, 2014

This is my second installment in a series on recognizing, understanding and thinking about exceptions, and about exception handing in a Human Resources context (see Part 1.)

I began discussing exceptions and exception handling in an HR context in Part 1 and will continue that here, beginning with what at least should be a simplest and most standardizable situation where personnel-related exceptions would arise: bringing in and working with outside consultants and contractors. But before I do so I would set the stage for this more specific discussion with more generally applicable comments and observations.

• Every business, however informally run, has at least some operational policies and procedures in place that are followed as set basic operating procedures and in a standardized manner, or at least with that as their goal.
• As businesses become more settled and structured, more and more of their overall operational needs are moved into these patterns of consistent process, and with fewer and fewer exceptions allowed. As an extreme, businesses can become sclerotic and unable to effectively identify and address exceptions, or change at all for that matter.
• But circumstances and needs change, and there is always the possibility that unexpected and unplanned for contingencies will arise that call for novel and exception-handling solutions. And that applies to Human Resources and to management of personnel-related processes and procedures, as much as it does to any other functional areas within a business organization.

With that in mind as a working foundation and framework, I turn to consider the basic business-as-usual and exception handling requirements of bringing in and working with outside consultants and contract workers. And I do so by noting that in many if not most cases, these not-quite employees often perform tasks that are important to and even essential to the hiring business, they are offered access to information resources that are as wide-ranging and sensitive for their content as would be made available to more traditionally in-house employees – and often to more such information and to more sensitive information than would be accessible to lower level in-house employees except insofar as that access was specifically required in their job descriptions. But in a fundamental sense any outside consultant or contract worker comes in as, and remains an outsider.

• Outside consultants and contract workers by definition are not eligible for employee benefits, including but not limited to paid vacation or sick time off, basic annual or otherwise routinely scheduled employee bonuses or in-house cost of living adjustments to base pay (which usually constitutes their entire pay), or in-house provided training.
• If they receive any specific benefits in addition to their base pay, this would be separately negotiated in their contract with the hiring/client business (e.g. early completion bonus compensation), or as a private arrangement with their in-house supervisor for this work (e.g. allowance to arrive late or even take a day off with pay after putting in unexpected overtime, as a one time or specially agreed to exception.)
• But everyone who works at a business has to be included under both legally mandated and corporate policy-based protections against workplace discrimination. The first point I would raise here specifically addressing the issues of this posting is that you need to know where the in-house versus outsider distinction that marks off outside consultants and contract workers, does and does not apply. And the basic rule of thumb in answering that, is found in knowing where not offering in-house rights, protections, or options would create liability or other risks.
• This means knowing and thinking through in detail, what is offered to in-house employees and to outsiders brought in for specific task responsibilities and how these sets of options differ. And this means knowing and thinking through the risk management consequences that could arise from the differences found, where this is a matter of actual practice followed, even more than it is of official policy in place. If, as a case in point, an outside consultant approaches HR to ask for advice related to a perceived workplace discrimination challenge, and the Human Resources representative they speak with tells them that they only offer counseling or advice on this to in-house employees, you have to assume that this consultant will go right to an outside attorney for help, who will then begin filing a claim against the business itself as having caused this problem – even if they would actively support an in-house employee making the same claims and under otherwise identical circumstances. And especially if that were the case, this business would probably lose and in civil suit challenge if nowhere else.

And this brings me to the question of overall business policy, and of how exceptional it is or is not to bring in non-in-house employees at all. Most businesses do this sparingly and more genuinely as exceptions and some do this routinely and even for very significant percentages of their overall headcount actually working at any given time. Microsoft comes immediately to mind there. I am going to continue this discussion in a next series installment where I will delve into that distinction and into operationalizing and standardizing practices and policies for working with outside consultants and contract workers as employees. And as a part of that, I will discuss the issues of working with stand-alone outside workers, and with outside workers who are employees of consulting or contract worker firms. Meanwhile, you can find this posting and series, as well as other related material at HR and Personnel.

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