Independent Contractors need Recognition too!

Recognizing Independent Contractors

Earlier this year, legislation was introduced in Congress that would have effectively banned independent contractor classifications under federal labor law. Those in the incentives, rewards & recognition marketplaces would have been adversely affected.

Good News: Independent Contractor Status Rule Under the Fair Labor Standards Act is Withdrawn

On May 5, 2021, the Department of Labor announced a final rule withdrawing the “Independent Contractor Status Under the Fair Labor Standards Act” final rule (Independent Contractor Rule). The withdrawal was effective immediately upon publication in the Federal Register on May 6, 2021.

This is a welcome withdrawal for all industries that use independent contractors, and it’s an excellent time to review incentive, reward, and recognition programs for independent contractors.

Preparing for Post-COVID Employee Trends

These four employee trends are predicted:

  1. Remote work is here to stay
  2. A blended workplace of both in-office and remote may be the future
  3. Learning and development are top employee priorities
  4. Employee burnout is a threat to the health of your workforce

A targeted incentive, recognition, and reward program for independent contractors is one way to prepare for each of these predicted trends:

  • Independent contractors may have already been working remotely and keeping engagement levels up takes a concerted effort.
  • A properly structured reward & recognition program can include opportunities for learning new skills, accessing new information, and testing or other assessment tools.
  • Likewise, an effectively designed incentive and recognition program can incorporate safety and wellness goals as well as offering travel or stress-relieving options that can help contractors recharge before they burn out.

Recognition = Retention

While many companies are focused on retaining key employees, independent contractors maybe even more inclined to look for new opportunities. Appreciating, recognizing, and rewarding achievement is a key factor in employee retention; the concept is the same for independent contractors.

Contact us to learn more about how you can retain your top independent contractors through an effectively designed recognition program!


Read the Incentive Federation Inc.’s bulletin: Final Rule: Independent Contractor Status Rule Under the Fair Labor Standards Act is Withdrawn



In economic terms, the multiplier effect refers to the proportional increase or decrease in final income that results from an injection or withdrawal of capital. In terms of Safety Reward Programs, the multiplier effect might refer to the ROI² (Return on Incentive Investment). A properly structured program significantly impacts overall employee engagement and safety culture, where employees are attuned to safety-related issues, inspired to display “Above & Beyond” safe behaviors, willing to be safety ambassadors, and encouraged to promote learning and support continuous improvement. Such best-in-class programs are designed to promote group objectives and reward individual behavior, engaging, motivating, and rewarding the people behind your success.

Fortunately, there are thousands of companies in high-risk industries that have excellent safety programming, training, and coaching in place. Many include safety in their list of core values and have invested heavily in EHS (Environment, Health, and Safety) technology, training, telematics, and personnel. However, too many miss the opportunity to incentivize and recognize individual safety contributions, behaviors, and performance.

Programs featuring tangible and experiential awards as the reward currency can have a multiplying effect that pays dividends. Benefits include a more highly engaged workforce, fewer accidents and incidents, reduced claims and losses, lower turnover and absenteeism, better communication, increased productivity, visibility to leading and lagging indicators, incremental coaching and training opportunities, and improved profitability.

So, what’s the rub? Are engagement programs focused on employee safety, health, and wellness expensive to implement? Do they only make sense for companies with thousands of safety-sensitive workers? The answer to both questions is no. Properly structured programs can be cost-effective and right-sized for companies with as few as 100 safety-sensitive workers up to those with 10,000 or more. The ROI² of these programs can be expressed as a ratio (in this case, 4:1), with quantitative results showing a savings of $4.00 for every $1.00 invested and qualitative results revealing higher employee morale, which serves as a catalyst for productivity. Safety Reward Programs help to mitigate risk, elevate employee engagement, and improve overall safety culture. They also present an excellent opportunity for companies to simply say thank you to their employees for being safe, committed, and engaged.

People have an inherent need to know that their efforts do not go unnoticed. Safety Reward Programs provide the stimulus and energy that encourage employees to perform at their best and achieve new heights.



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