Successful freelancer management
Clear processing of contracts etc.
Flexible, agile and scalable: Working with freelancers has many advantages, but at the same time there are a few points to consider in advance. To ensure that the cooperation is successful for both sides, here are tips and tricks on what to look out for when bringing freelancers into the team.
Freelancers and companies benefit equally
Since the 1990s, the number of freelancers in Germany has tripled: In 2020, according to a study by the Institute for Freelance Professions Erlangen (IFB), among others, it was around 1.45 million (source: statista.com). The trend is rising, because for many the advantages correspond to today’s understanding of a modern way of working: Independence, flexible tasks and scheduling, a mostly location-independent assignment, and the opportunity to specialize in certain fields. Companies also benefit from this, because they can decide at short notice whether to book additional support from freelancers, depending on the volume of orders. This keeps the core team manageable and scalable, and the ongoing costs calculable. The initial organizational effort may be somewhat higher than compared to permanent employees, but there are increasingly better technological options available, such as software, to make freelancer management run smoothly. Departments such as HR are thus relieved and workflows become more efficient.
Trust and fairness: The cornerstone of good collaboration
When freelancers are hired for projects, the first thing that comes up is the contract. Fairness and transparency on both sides create a basis of trust on which work can be done well. The contract should correspond to the subsequent work process and tasks. If, for example, it is stated that the work is freelance, but in reality it is subject to instructions, it is no longer considered self-employed. It can be quite costly for companies if it is a false self-employment but such is not the case. Social security contributions for example will then have to be paid retroactively.
The freelance contract: Individualization instead of a standard template
What should a freelance contract look like? Ideally, it should cover everything important and be tailored as precisely as possible to the collaboration; prefabricated contracts are usually not sufficient. Whether a service or a work contract is concluded depends on the type of employment: In a service contract, the freelancer agrees to take on and deliver a specified activity, but is not bound to a specific project or assignment. In a contract for work, on the other hand, the contractor is bound to a project or the production and completion of work.
7 points that can be used to set up freelancer contracts
- Define concrete tasks and scope
The more precisely concrete tasks, desired results and the scope of work are defined, the fewer ambiguities and points of disagreement there will be later. It is also helpful to define a time frame for specific tasks. - Determine the amount and timing of compensation
On the one hand, this provides security for the freelancer, and on the other hand, it provides a better overview of costs for the company. In addition, it prevents possible later renegotiations and both sides know from the get-go how the work will be compensated. - Setting deadlines for completion
While freelancers are quite free to decide when and where to work and how much, deadlines can be set. With a concrete timeline, the company can better plan for when they can count on a freelancer’s assistance and expect results. Realistic deadlines help prevent potential shortfalls and delays, and keep to time constraints. - Confidentiality agreement
Freelancers sometimes get many and deep insights into confidential documents during their projects. To protect sensitive and security-critical information, a confidentiality agreement is of high importance. - Define acceptance and right of retention
The right of retention describes the right to withhold a specific service until the contractual partner has fulfilled its contractual obligation. This ensures that a certain quality is achieved upon acceptance and that it is rewarded accordingly. - Competition clause
The contract should also include the question of whether freelancers are allowed to work for other companies and competitors at the same time or whether there is exclusivity. If necessary, a corresponding agreement should be made in the contract. - Ensure implementation of the agreement
To ensure successful implementation, superiors should also be informed about the agreements. Agreements on the place of performance, place of jurisdiction, protective regulations under labor law and ancillary agreements can be recorded in the contract. In addition, it is useful if the team members are also made aware of the freelancer’s lack of authority to issue instructions.
Successfully implementing projects with good communication
Goal-oriented communication contributes to success. For this purpose, regular deadlines and media can be defined, for example, telephone, e-mail, collaboration software or direct conversation. If possible, communication with freelancers can also be integrated into the company’s internal communication channels, such as e-mail programs or instant messaging services. This saves time and helps with organizational matters, as the progress of the project and its current status can be seen directly.
Payment: The basis for further projects
Payment varies from company to company, but monthly or weekly payments are common practice. For this purpose, the client and the contractor are provided with timesheets, after which they are invoiced - and as promptly as possible, so that both sides are satisfied. If the project is completed and payment is good, there is nothing to stop the two parties from working together again.
Amount of compensation
The payment of self-employed freelancers should be on par with that of permanent employees or higher, but at least above the minimum wage of the respective industry. Especially in the low-wage sector, the suspicion of false self-employment would otherwise quickly arise. Clients should also bear in mind that the fee paid to freelancers should always leave room for personal provision. If all data for billing is available within a regulated time frame, project completions can be managed in a time-saving manner. For cost and work calculation, this means that expenses can be planned ahead.
Use the right software
For effective freelancer management, there are helpful tools that make administration and processing easier. aiFind is one such tool: Headhunters and recruiters can use the cloud software to achieve even faster and better results in their search for suitable professionals. They benefit from intelligent technologies such as CV parsing and analytics, location search and document tracking. To keep the workflow as simple as possible, customers and freelancers can also access the software themselves via contract-based access. Additional packages can be booked to conveniently automate time recording and invoicing, and other invoicing software such as Lexoffice.
More order, less paperwork and a higher level of quality: With simple management of active processes and contracts and a clear dashboard for the recruiter, aiFind is a holistic and efficient solution.
Conclusion
Hiring freelancers can bring many benefits to companies: More scalable planning of their own resources, as well as time and cost savings. In order to properly exploit the potential and ensure successful collaboration, particular attention should be paid to fairness and transparency for both sides when drafting the freelancer contract. With the right software, your own freelancer management benefits from modern technical possibilities, resulting in clear and efficient administration and organization.
You would also like to optimize your freelancer management? aiFind is your competent partner for cloud software for HR consultants. With the integrated Time Sheet Portal, you can now manage time tracking even faster and easier - so you can keep an overview. For more information, use our contact form!
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