Gig Economy

Platforms, Marketplaces Woo Gig Workers With Timely Payments

freelancer

Gig workers (freelancers if you prefer) are starting to get the attention and support they’ve earned. It’s been a long time coming — ask almost any freelance pro — but a pandemic, workforce changes and new market dynamics are finally bringing indie contractors into the fold.

Proof is in the spread of platforms, marketplaces and cloud services now available to help freelancers find work, get paid faster, market their “Me-as-a-Service” offering, handle tech or accounting needs, and create work-from-home business lives that rival anything office-based.

It’s all turned around rather quickly, pushed by the pandemic. Employers falling behind the curve on gig worker support will increasingly be passed over for those that offer it readily.

“Platforms may be reevaluating how they support freelancers, yet gig workers are also taking a closer look at their relationships with clients,” according to PYMNTS’ May Gig Economy Tracker, powered by Tipalti. “Companies that want to hire freelancers but employ outdated invoicing, payment and onboarding processes will find themselves losing out to others that can provide quick, seamless access to benefits and funds.”

As the May 2020 Tracker states, “[Companies] must instead lock into freelancers’ specific needs, making it crucial that they figure out how COVID-19 has affected different groups of gig workers today and what that means for such workers’ futures.”

Statements like that make freelancers smile. Business has now gone from treating them as a useful afterthought to being valued team members, getting the tools to succeed.

Payables and Loyalty

There’s an indescribable cognitive dissonance that happens after doing serious work on deadline for a new or existing client, living their urgency and delivering the goods, only to spend weeks or months pursuing firms for payment. Mood impacts aside, this state of affairs hinders the buying of internet access, of online collaboration tools, and hobbles the ability to fix a broken laptop while on deadline. It also interferes with paying for food, rent and electricity.

“Gig workers are accustomed to hunting down late payments from companies, with 71 percent noting they have worked with firms that have paid them late or not paid at all,” the new Tracker states. “Platforms thus need to find solutions that can speed up freelancers’ invoicing and payment experiences or risk tarnishing their relationships with these individuals forever.”

Friction of one kind or another is behind almost every delayed freelance payment. Whatever the cause, it’s fundamentally a cash flow issue, and one that has gotten more dire recently.

“Cash flow management is on everyone’s minds — both for the payors and the gig workers,”

Tipalti CFO Sarah Spoja told PYMNTS. “Payors may look to extend payment terms from net 7 to net 30 or more as they are stretched. Meanwhile, gig workers are looking for ways to ensure they have payments coming in sooner so they can survive.”

“At Tipalti, beyond our core payables automation solution, we are getting more interest from companies that are looking to offer early payment programs at scale so they can balance the needs of both and maintain gig worker loyalty.”

The Future of Gig Work

Developments in gig worker payments are pacing the rapid expansion in the consumer payments space. It’s being widely observed that offering more payment options translates into higher satisfaction for, in this case, gig workers. That means better business outcomes for the marketplaces where they increasingly concentrate their search for ideal gigs.

“Keeping gig workers satisfied will become increasingly important in a world where freelance services are responsible for completing more projects,” the report states. “The post-COVID-19 world could lead many companies to decide that remote working is the direction for future operations, and freelancers will be critical here. Making sure they can quickly sign on to these marketplaces and keep working is step one in securing that future.”

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