Closing the Deal in a Competitive Environment: Contractor Attraction

The competitive environment of the contractor landscape in Australia continues to be tight in many sectors and job families. Organisations are tapping into the changing needs of workers in an effort to secure the best and brightest talent amid demanding growth targets and skills gaps.

But finding and negotiating with new workers – particularly independent contractors – is no easy feat for today’s employers. The increasing number of workers choosing to ‘career contract’ has given them the upper hand. With high-demand skills and a mindset of flexibility, adaptability and market foresight, landing the best contract talent in such a competitive environment can be difficult.

So today, we’re looking at the best tactics for closing the deal with talented contractors in this competitive environment.

contract negotiation in a competitive environment

Gaining the Upper Hand in a Competitive Environment

In some industries, where a weak labour market is apparent, candidates can be left feeling somewhat powerless, or having very little negotiating leverage; their bargaining power is seemingly diminished.

However, this isn’t going to necessarily be the case in today’s talent marketplace. Hear me out.

The complexity of the job market today, means the terms of negotiation are many and varied. A candidate may be less focused on dollar remuneration, and more interested in your company’s policy on sustainability, social contribution, flexibility, hybrid working or job sharing.

The key fact to remember here is this: your negotiation with independent contractors (or any talent, really), matters most when there is a broad range of potential outcomes. Knowing what you’re willing to compromise to secure the right person, and what their key drivers are, will place you in a strong position, with the ideal result feeling like both parties ‘won’.

Finding Your Common Ground

Entering a negotiation with a potential independent contractor with the wrong mindset can be catastrophic to your desired outcome. Especially in today’s competitive environment.

“Ninety-eight percent of the time, we begin by pushing, believing it’ll lead to the other side budging,” said Dr. Jonah Berger, a professor of marketing at the Wharton School and author of book The Catalyst. “But people aren’t furniture. They push back, dig their heels in.”

Ideally, as the employer, try to be the catalyst for change and mitigate obstacles with the contractor. Think about the barriers you can remove to make it easier for the contractor to mentally change course and be more inclined to agree with you. At this stage of the negotiation, it’s a great tactic to determine all the factors you have in common.

Let the contractor know you’re thrilled they’re interested in the role, you’re impressed with their skills and experience, and you can see how the role will enhance their career and expertise. Phrasing this in a way that determines you both want the same thing is critical. This will remove any potentially adversarial vibes, it will entice the contractor to be more candid, and will make them feel like they’re already part of the team.

A final point on common ground is to get to know the contractor as well. Find out more about their hobbies, interests, their career and their aspirations. And be prepared to share the same insights about yourself.

negotiating with independent contractors

Find Those Negotiating Points They Really Care About

As the employer in this negotiation, be prepared to rank those points you’re willing to negotiate on. And likewise, aim to uncover those points of flexibility from the contractor.

Where can you offer leeway or suggest a compromise?

Are factors like hybrid working, flexibility or a shorter working week of prime importance to the contractor? Or would a company-sponsored gym membership for their tenure with your business be a better negotiating point?

Get to the point with the contractor, by simply asking the question. And listen actively to their response. If they seem stumped, continue to engage in a non-defensive way – this point is crucial.

By asking the right questions, you can start to guide the discussion, understand their limits, and potentially use those insights to arrive at a winning compromise.

Responding to a Counteroffer in a Competitive Environment

Contractors are typically very adept at keeping their ear to the ground, regarding opportunities in their area of expertise. Good contractors will know exactly what they want, they will have undertaken the industry research and will know their worth. This is especially so in today’s competitive environment.

So, if their current host makes a counteroffer after your first pitch, or if the contractor makes an alternative offer, this shouldn’t come as a surprise.

Just make sure you’ve also undertaken adequate research. This must include:

  • Industry research and availability of talent for the contract at hand
  • Expertise sought in the market for a similar role
  • Ideal credentials for this type of contract
  • The ideal education and training for the role (knowing if a candidate doesn’t quite match the level you’re after, offering this training could be a good point of negotiation)

In the contractor hiring market, a counteroffer can be presented in a couple of ways:

  • An offer from the contractor’s current host, in a bid to convince them to stay longer in their current contract
  • An offer made by the contractor to your first negotiation pitch.

Often, the current host will offer them one or a combination of the following: a higher contract rate, additional company benefits (within the limitations of any statutory requirements for contractors), an extension to their contract, a change or progression in their current contracting role, or the offer of more involvement in projects.

Keep in mind that while your offer and contract may seem super appealing to you, the contractor will almost always sit back and consider their options. This is especially so if they’re motivated by money or exposure to exciting new projects with their current host.

But there are ways to urge the contractor to want to work in your business. These include:

  • Understand their drive for a new contract. Is their current working environment toxic? Do they feel a lack of growth potential with their host? Are they not being challenged enough? These facts need to be unearthed early in your conversations by getting the contractor to outline their ideal contract scenario
  • Be open and upfront about the contractor perks, relevant to their key drivers. These may be learning and development opportunities, the ability to move across the company to undertake different contracts, or flexible working hours. Just be sure to make it very clear about what’s in it for them
  • Build trust with the contractor. Eliminate any worries they have and be encouraging about change, especially if they’ve been in their current host company for a long time. Listen actively to their concerns and aspirations
  • Move swiftly. Don’t let your internal delays get in the way of securing the contractor. If you snooze, you will most definitely lose. Contractors are used to being sought-after, especially those with highly specialist skills. And especially in today’s competitive environment. Stay in touch with them throughout the process, and make sure you keep it moving.

If the contractor decides to stay with their current host or accept a counteroffer, it’s important to respect their decision and know when to walk away. Because you never know – there may be opportunities for the contractor to work in your business down the track. So, parting on good terms is really important.


Attracting contractors to your business in today’s competitive environment requires tact, patience, research and good interpersonal skills. Remaining focused on the business need is important, more so than ‘winning’ the negotiation. Securing the right person in today’s competitive environment is the ultimate goal for your business…. something you must never lose sight of.

Finally, please do contact us if you have any feedback or comments.

As one of the world’s leading providers of contingent worker management solutionsCXC is well-positioned to optimise all elements of your contingent workforce strategy.

With operations in more than 50 countries across five continents and decades of experience, we can assist with every aspect of your program.

If you’d like to discuss recruitment automation trends, please don’t hesitate to contact us.