What Are Contingent Workers and Why Hire Internationally?

Building a flexible workforce is no longer optional—it's a strategic advantage. From freelancers to consultants, contingent workers help companies scale faster and adapt to shifting priorities. 

But what exactly is a contingent worker? And why are more businesses looking beyond borders—especially to LatAm—for top talent? 

In this article, we'll break down what you need to know, the key differences from traditional employees, and how to hire internationally without legal complexities. 

What Is a Contingent Worker?

Contingent workers are non-permanent professionals supporting a company on a specific project or for a short-term need. They are considered non-employees, therefore work outside the traditional full-time setup. 

Their contingent work arrangements are typically flexible and based on defined deliverables or timelines, rather than ongoing responsibilities.

This category includes:

• Freelancers.
• Independent contractors.
• Consultants.
• Project-based or gig workers.
• Interns—when unpaid or working on a temporary basis, they may be considered contingent.

Moreover, contingent workers can be local or international. Many companies today choose international collaborators. Why? To tap into top talent, cut costs, and boost capabilities.

This may sound complex, but it's actually pretty simple. With partners like Lupa, businesses can hire and manage professionals across LatAm—without the usual legal and operational complexities.

We offer end-to-end solutions that include recruiting, staffing, and recruitment process outsourcing (RPO). The result? A comprehensive hiring experience from candidate sourcing to talent management.

What Is the Difference Between an Employee and a Contingent Worker?

The main difference between contingent workers and regular employees lies in the nature of their work arrangement and the benefits they receive. Here's a breakdown of how they compare:

Why Do Companies Hire Contingent Workers?

More and more companies are turning to contingent labor. All in all, it is a smart, strategic way to build agile teams and scale efficiently. 

Let's see some of the top reasons businesses choose this model:

Workforce Flexibility

Contingent workers allow companies to quickly scale teams up or down based on project needs, seasonal demands, or budget shifts—without the long-term commitment of full-time hires. 

Plus, contingent hiring also gives businesses more control over workforce planning, allowing them to align talent needs with changing priorities and budgets.

On-demand Access to Specialized Talent 

Need a UX designer for a product sprint? Or maybe a data analyst for a short-term project? 

These collaborators make it easy to fill skills gaps or shortages and bring in niche expertise exactly when you need it.

Lower Compensation Costs

Companies can significantly reduce labor expenses while still working with high-quality professionals. 

Plus, contingent workers offer more flexible pricing, allowing companies to align labor costs with project budgets.

Minimal Training Investment

Contingent workers are usually hired for their specific skills—no major welcoming processes. This reduces the time and money typically spent on onboarding and training.

No Employer Taxes or Administrative Process

Contingent workers aren't on payroll. Therefore, businesses avoid employer tax contributions, social security payments, and other human resources processes—especially when partnering with platforms that handle compliance.

A Smarter Alternative: Hiring Remote LatAm Talent as a Contingent Worker

For fast-scaling companies—especially in tech—hiring remote talent from LatAm as contingent workers is becoming a go-to strategy. 

All in all, LatAm is a modern, agile alternative to other offshoring models. Mostly, it offers greater control, higher-quality talent, and fewer operational headaches.

Instead of dealing with agencies or long-term hires, you get direct access to top-tier professionals who are cost-effective, experienced, and just a few time zones away.

LatAm offers a rich mix of experienced developers, graphic designers, marketers, and analysts who are used to working remotely and delivering results on tight timelines.

Benefits of Hiring Contingent Workers from LatAm

Hiring contingent workers from LatAm offers fast-growing companies the perfect balance of flexibility, quality, and cost savings. 

Let's see some of the reasons why this talent market is worth considering:

• Top talent in your time zone: Collaborate in real time with professionals working in time zones that align closely with the U.S.
• Cost efficiency without compromising quality: Access high-level expertise at rates that are significantly more affordable than U.S.-based hires.
• Specialized skills on demand: Find experienced developers, marketers, designers, and analysts with specific skill sets ready to jump into your projects.
• Strong remote work culture: LatAm professionals are used to remote work and global team dynamics.
• Cultural and communication fit: Shared values, strong English proficiency, and similar work styles make collaboration seamless.

Common Roles You Can Fill with LatAm Contingent Workers

One of the best things about hiring from LatAm is the wide range of skilled professionals available across all kinds of business roles. 

Here are some of the most in-demand roles companies fill with top LatAm talent:

• Software developers.
• Product designers.
• Marketing specialists.
• Customer support reps.
• Project managers.

How to Onboard LatAm Talent without the Legal Headaches

Bringing on contingent workers from LatAm can be straightforward—if you have the right setup. Here's how to do it without running into legal or compliance issues:

Clarify the Contractor Relationship

Before hiring, make sure the role qualifies as an independent contractor and not a full-time employee. 

This distinction is important, as it impacts how you manage payments, taxes, and benefits.

Misclassifying a worker can lead to legal issues and fines. To avoid that, make sure to define expectations and the nature of the relationship from the start.

Draft Clear, Locally Compliant Contracts

Contracts should outline key terms such as:

• Scope of work.
• Deliverables.
• Payment schedules.
• Timelines.
• Intellectual property ownership.

They must also comply with local laws in the contractor's country. The process often involves both human resources and procurement teams working together to manage contracts, compliance, and payments.

Set Up Reliable International Payment Systems

Paying contractors abroad isn't as simple as sending a bank transfer. That said, it isn't complex either.

The difference? You'll need systems that can handle cross-border payments securely, while complying with tax reporting obligations in both countries.

Delayed or inconsistent payments can hurt relationships and productivity.

Stay Up to Date on Local Regulations

Each country in LatAm has its own rules. From labor laws to tax obligations, there are key regulations you need to understand and follow to stay compliant. 

Plus, what's compliant in Argentina may not apply in Colombia or Brazil.

Keeping up with these differences is essential to avoid missteps and ensure a smooth working relationship.

Create a Smooth Onboarding Experience

Even though contingent workers aren't full-time employees, they can still benefit from an onboarding process. 

Create a warm welcome for them by introducing them to the team, sharing tools and processes, and clarifying project goals. 

Partner with a Specialized Recruiting Agency

Want to move fast and hire the right talent without getting lost in the details? Then, partnering with a staffing agency that specializes in the LatAm market can make all the difference.

An experienced agency does more than just help you find top-tier candidates. They provide a management system to handle everything from hiring to compliance—understanding the cultural nuances, market dynamics, and compliance rules in each country. 

The result? Faster hires, better fits, and far fewer legal headaches.

That's exactly what we do at LupaHire. We don't just connect you with vetted professionals across LatAm—we also manage contracts, payments, and local compliance so you can build your team with confidence.

FAQs about Contingent Workers and LatAm Hiring

Still got questions? Here are quick answers to the most common questions about hiring contingent workers from LatAm.

How Do Contingent Workers Get Paid?

Contingent workers are paid for projects, hourly, or based on milestones. That is, on an as-needed basis. 

Plus, businesses do not withhold employment taxes. Contractors handle their own tax obligations—from income tax to self-employment tax, including social security contributions.

What Are the Types of Contingent Workers?

Contingent workers include a wide range of professionals who are not full-time employees. Common types include:

• Independent contractors.
• Freelancers or service providers. 
• Consultants. 
• Interns.
• Gig or temporary workers.

What Is a Contingent Salary?

There's no fixed salary for contingent workers. Instead, companies pay them based on specific rates—hourly, per task, or on a project basis. 

Plus, they aren't full-time employees, so they do not receive benefits like healthcare or paid time off.

What Is Contingent Workforce Management?

It refers to how companies organize, onboard, and manage contract workers. It includes:

• Sourcing talent.
• Drafting compliant contracts.
• Managing deliverables.
• Ensuring payment systems are in place.
• Aligning with employment law and human resources policies.

Your in-house human resources team can handle this directly. Prefer avoiding the hassle? Partner with a specialized agency that handles the entire process. 

Is an Intern a Contingent Worker?

Sometimes interns can be classified as contingent workers. Especially if they are not salaried employees and are engaged for a short-term project—particularly if unpaid or project-specific.

How Large Is the Contingent Workforce?

According to the U.S. Bureau of Labor Statistics (BLS), about 4.3% of the U.S. workforce are contingent workers—that's around 6.9 million people. 

That number has grown from 3.8% back in 2017, and it's expected to keep rising as more companies look for flexibility.

Is Managing Contingent Workers Different from Managing Full-Time Employees?

Yes, it is. Contingent workers are usually self-employed. And, even when they're not, they generally don't need the same level of supervision or structure as full-time staff.

That said—the basics still matter. Make sure to provide:

• Clear, consistent communication.
• Well-defined expectations from the start.
• The right tools to keep everyone aligned and on track.

How Do Agency Contractors and Independent Contractors Differ?

• Agency contractors: They are employed by a third-party agency, but work on assignments for your company.
• Independent contractors: They are self-employed and work directly with you under a contract. No third-party involved.

Can Any Worker Be Classified as a Contingent Worker?

Not quite. You can't just label any worker as «contingent», even if they work part-time or are interns. Misclassifying someone can lead to legal and financial trouble, especially when it comes to IRS regulations around employment taxes.

What Are the Key Factors to Classify Employees as Contingent Workers in the U.S.?

Classifying a worker correctly—as either a contract worker or an employee—is critical under U.S. employment law. They provide an economic reality test to determine the nature of the working relationship. 

The main question:  Are workers economically dependent on the employer, or are they in business for themselves?

Here are the core factors to consider:

• Opportunity for profit or loss: Are workers making a profit or taking a loss based on how they manage their time, effort, and business decisions?
• Worker and employer investments: Have workers made their own investments in tools, equipment, or resources to perform the work? Significant investment suggests independent contractor status.
• Permanence of the relationship: A relationship that continues indefinitely may point to employee status, while a defined, project-based relationship supports contractor classification.
• Control over work: Who decides how, when, and where the work gets done? More employer control indicates an employee relationship.
• Integral nature of the work: Are workers performing tasks that are central to the company's business? If yes, they may be considered employees.
• Skill and initiative: Are workers bringing specialized skills and operating with business initiative? Independent contractors typically do.

No single factor determines status on its own—the full picture matters. Misclassification can lead to issues with employment taxes, human resources, healthcare obligations, and wage law compliance.

Start Hiring Contingent Workers in LatAm!

Ready to build a dynamic and responsive contingent workforce? LupaHire's recruiting services connect you with the best contingent talent in the market. 

Find your ideal contingent workers with Lupa Hire now.