Scaling the Flexible Workforce: Beyond AP Automation to Revenue Protection

With 56% of businesses planning to hire more professional independent workers, the shift away from the traditional W-2 model is undeniable.

And it's not hard to see why.

Apart from giving you the flexibility to scale, independent contractors drive revenue and offer access to specialized expertise.

But most businesses are stuck using legacy payroll and accounts payable (AP) systems that make it impossible to scale their contractor pool up and down as needed…defeating the purpose of bringing in a flexible workforce in the first place.

Don’t let the wrong systems hold you back from growth. 

In this post, we’ll talk through why these legacy solutions may be great to manage your W2 workforce or vendors but fail for your 1099 workforce—and how a complete contractor management system can help you scale more effectively.

 Key takeaways

• Independent contractors are revenue generators, not vendors. Slow onboarding translates directly to lost revenue, and a poor contractor experience makes it difficult to retain these key workers.
• Legacy AP systems built for vendors and payroll systems designed for W-2 employees do not support the speed or compliance needs of the flexible economy.
• Wingspan automates onboarding, enforces compliance gating, and offers a rich contractor experience to optimize talent retention and revenue protection.

Why legacy systems fail to manage contractors at scale

If you’re patching together traditional payroll or accounts payable with a spreadsheet or Zapier workaround, that may be fine for a few contractors. But the reality is that legacy systems simply cannot deliver the speed, flexibility, and efficiency your business needs to grow.

Studies by Worldwide Business Research (WBR) and Wingspan show that most companies lack efficient and scalable processes and systems to manage independent contractors.

Legacy systems slow growth because:

• Lack of flexibility: Traditional HRIS and payroll systems, such as ADP and Workday, are designed for full-time employees. They’re designed with the idea that once you onboard an employee, they’ll be at the company for at least a year or more. (Not to mention, their payment plans reflect this assumption.)
• Impersonal interfaces: AP systems that are designed to manage vendors treat a specialized radiologist the same as a utility company, offering impersonal interfaces, slow payment terms, and a complete lack of transparency for the contractor, leading to hundreds of, “Where is my payment?” emails that bog down your support team.
• Compliance issues: Few traditional payment systems include the ability to process 1099s, making it a manual, time-consuming process for you each January. Businesses managing a mixed workforce of domestic and international contractors face a significant risk of audits, penalties, and class action lawsuits if tax regulations are misapplied.

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These systems present very real consequences for your business that prevent your growth. Consider the insurance industry as an example. Independent adjusters must be deployed rapidly following a catastrophe. If onboarding takes weeks due to disjointed software tools and manual email workflows, not only is it a pain for contractors to manage, but you won’t be able to respond to time-sensitive events. 

In insurance, most businesses compete to hire from the same pool of independent adjusters. So why should a contractor stay with you if you offer a poor contractor experience, or take forever to pay them? 57% of businesses in WBR’s study say paying contractors on time is one of the top challenges. Legacy systems can’t respond to the demands of your contractor workforce and put undue burden on your administrative team.

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The solution: A complete contractor management system

To succeed as a business running on contractor talent, you must engage and retain the revenue-generating talent, stay compliant with regulations, and maintain data protection standards.

A complete contractor management system goes beyond legacy systems by bundling the critical features you need into a unified contractor lifecycle platform. Your team is buckling under the pressure of corralling multiple systems into one spreadsheet—and your contractors aren’t loving it, either.

You need a system with features like:

• Instant payments that allow contractors to get paid right when work is done. 
• Onboarding that automates W-9 collection and real-time TIN matching, ensuring 1099 filings are accurate come tax season.
• Automated compliance that blocks payment when contractors are missing key information or it’s outdated.
• White-label onboarding and payment that allows you to dictate brand and UX so you’re in control (and don’t need to build capabilities from scratch), via a robust API.
• Access to a benefits marketplace for contractors with a selection of health, dental, and vision insurance plans so they can best run their business.

The future of the contingent workforce requires more than a payment processor. What you need is a comprehensive contractor management platform. And you can find these features and more with Wingspan.

Automate Contractor Management with Wingspan

Here’s a quick comparison of how Wingspan compares to legacy point systems.

Wingspan’s Contractor Management Platform vs Point Solutions

How Wingspan Compares

Category

Wingspan

BILL AP Automation

Gusto Payroll

Core Philosophy

Contractor lifecycle focused on people

AP automation focused on vendors

Payroll focused on employees

Primary Buyer

Operations, HR, Finance

Controller or CFO

SMB owner or HR

Payment Speed

Instant debit or wallet payments and global transfers

Standard ACH takes 2–4 days

Standard payroll cycles

Compliance Gating

Automated and gated

Limited

Basic

Benefits Access

High, including insurance and voluntary withholding

None

None for contractors

Integration

Wingspan Embed and API

Standard ERP sync

All-in-one bundle

Pricing

Pay only for the contractors that actually work in a given month

Subscription + per transaction fees

Subscription + fees for each contractor payment processed

Wingspan moves enterprises beyond traditional AP or payroll by serving as a system of record for contractor operations. Consider contractor-driven organizations like Teladoc, where each one of their 10,000 providers is a 1099 worker. With Wingspan, Teladoc seamlessly organizes their contractor operations, saving 28 hours a month in processing administration. "It used to take me two days to process payroll. It takes me two hours to process payroll from start to end,” says Tricia McGimpsey, VP of Payroll at Teladoc.‍

And their providers love it, too: Since switching to Wingspan, support tickets have decreased by 90%. Says one contractor, “This new payroll system has been amazing. The emails letting me know when my paycheck will be deposited with the amount listed are so helpful.”

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See how Wingspan transforms your contractor operations → https://wingspan.navattic.com/demo

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