FAQs - Contingent Workforce Managed Service Provider

The Contingent workforce Managed Service Provider contract (MSP) offers a panel of managed services providers (MSPs) to provide services for a NSW Government agency (customer) to meet the requirements of a customer’s hiring managers. These services include the sourcing and management of contingent workers from contingent workforce suppliers available under the Contingent workforce scheme. The MSPs will work with contingent workforce suppliers in a vendor neutral arrangement and will only transact via the whole of government vendor management system (VMS).

The MSP contract is performance based and incorporates the following service requirements:

• functional and process requirements
• key performance indicators
• service level agreement
• reporting
• account management and service delivery
• implementation
• competitive pricing.

In line with the strategic objectives of this contract, the MSP provider must comply with the following requirements at no additional cost throughout the term of the contract:

• use the VMS nominated by the principal
• use of only prequalified suppliers under the scheme
• cooperation with the CMOs nominated by the principal
• vendor neutrality.

NSW Government objectives

NSW Government is implementing its contingent workforce strategy to achieve the following objectives:

• introduce best practice services and systems to drive value
• integrate contingent workforce with overall workforce planning
• make government contingent pool(s) the primary candidate source
• attract increased numbers of skilled candidates to NSW Government
• enhance procurement processes and systems for more effective and efficient deployment of the contingent workforce
• increase opportunities for participation by small and medium enterprises by reducing red tape
• decrease the cost of the contingent workforce.

Four projects have been identified as part of a combined Contingent Workforce solution to enable delivery of the government's strategic objectives:

• use of a single VMS
• a panel of MSPs
• a shared Contingent pool and contractor manager organisation (CMO)/Payroll provider panel
• a list of prequalified suppliers established under the  Contingent workforce prequalification scheme.

This solution is expected to deliver approximately $90 million in both hard and soft savings through efficiency gains in process, control, visibility, compliance, risk management, performance management and the improved quality of candidates presented to customer’s hiring managers.

Pricing

The services outlined in the contract constitute a standard offering and are priced accordingly. The on-boarding of an MSP will be undertaken by each customer by a separate request for quotation process or by direct appointment under a customer contract. This gives the customer the ability to specify the level of involvement they require, modify the scope of services, include any specific management or reporting requirements and obtain best pricing for the customer’s specific requirements.

Frequently asked questions

1. How do I engage an MSP?
   An MSP should be engaged across the whole agency, not for smaller departments unless you are managing a large bulk recruitment exercise which you need support for. Therefore it will be a decision that your HR and/or procurement areas need to manage for you. Contact them with your requirements.
    
2. How much does it cost the agency?
   Each supplier has submitted their own pricing, which is dependent on the spend under management and the level of service your agency wants. You need to agree on the service level agreement (SLA) before a firm price can be agreed. As a guide, it was a requirement that a maximum price of 2.50% of spend would apply. Pricing is based on a sliding scale discount: the larger your agency’s spend, the lower the percentage applied.

   Separate pricing has been agreed for one-off bulk recruitment exercises. This pricing is a flat fee. Talk to your procurement team for more information.
    

3. How much does it cost scheme suppliers?
   There is no cost to scheme suppliers to work with the MSP.
    
4. What do I need to consider when engaging an MSP?
   • Ensure extensive stakeholder engagement throughout the entire process.
   • Ensure there is a collaborative relationship/partnership.
   • Roles and responsibilities need to be clearly defined from the onset.
   • The MSP needs to take the time to understand the hiring managers and promote the benefits of the solution.
   • The need to minimise leakage through transparency and robust reporting.
   • Ensure SLAs are firm and parties know exactly what is expected.
      
5. How long will it take for an MSP to implement the VMS?
   The estimated timeframe is 90 days to implement the VMS however this depends on your level of readiness for the project. The MSP will work through your discovery phase and will assist with embedding best practice workflows to drive efficiencies faster.
    
6. What does MSP vendor neutrality mean?
   Vendor neutrality means that if your preferred MSP is also a supplier of contingent workers, they have agreed to transition their workers to another supplier. The MSP will never be a recruitment competitor within your agency. The MSP can never “manage” their own workers in your agency.
    
7. Will the MSP provide selection and assessment methodologies?
   Agencies are not mandated to use an MSP. If an agency engages an MSP, the agency will decide the level of service they want from the MSP.
    
8. How do the VMS and MSP components work under the Contingent Workforce Strategy?
   The VMS and MSP are services which support the contingent workforce strategy. MSPs will enable agencies to have a single interface between many suppliers.
    
9. Will suppliers retain ownership of their contingent workers?
   Yes. The VMS is the technology and the MSP is the advisor. Contingent workers remain employees of the scheme suppliers. Some agencies tend to refer to suppliers with a well-recognised brand rather than researching the market to identify other capable suppliers. Your MSP will do the research and will assist you to identify small to medium enterprises (SMEs) with the requisite capability and expertise to meet your requirements.
    
10. What is the interaction between MSPs and the scheme suppliers?
    MSPs will only be able to source from the prequalified suppliers. When your agency engages an MSP, that MSP will act on your behalf and the scheme suppliers are required to engage with the MSP. All transactions will happen via the VMS so that there is complete visibility of the whole recruitment process.
     
11. How will the VMS and MSP provide innovation for SMEs?
    The VMS and MSP will support agencies in providing more opportunities for SMEs to do business with government. The VMS reporting function will give agencies visibility of their spend patterns. The MSP will analyse these patterns and will assist agencies to identify trends or improve their use of SMEs.

More information

Please contact the NSW Procurement Service Centre [2] for further assistance.