LATAM: Lost in Translation
Contingent Chaos in LATAM
Welcome to this issue of The Contingent Compass. Each week, I send two essays to help you navigate the complex world of the Contingent Workforce. If you need support on your journey, upgrade to a paid subscription where you’ll instantly be able to interact with the community through group chat, live Q&A’s, gain access practical program tools and useful how-to guides.
LATAM looks manageable on PowerPoint slides. One region. A shared service center. Maybe even a unified supplier strategy.
But once you actually try to run a contingent workforce program across Latin America, that illusion crumbles.
Brazil isn’t Mexico. Argentina doesn’t behave like Colombia. The idea that a single playbook will work across these markets? That’s wishful thinking. And wishful thinking gets expensive.
You won’t just miss your goals. You’ll erode trust, invite compliance risks, and likely lose credibility with the very suppliers and hiring managers who could have helped you succeed.
Let’s cut through the assumptions and talk about what’s really going on in the LATAM contingent workforce landscape.
LATAM Isn’t Uniform. It’s a Patchwork
Here’s a quick snapshot. Not to oversimplify, but to emphasize how different each market really is:
Ask yourself: Are you treating each of these markets on its own terms, or just lumping them into a “rest of LATAM” box? Because your program outcomes will reflect the difference.
📊 Stat Spotlight: Over 50% of LATAM’s workforce is employed informally, according to the International Labour Organization. If your strategy only accounts for formal structures, you’re already overlooking half the talent.
Legal Complexity Isn’t Just a Risk. It’s a Moving Target
LATAM labor laws aren’t just strict. They’re dynamic. They shift with political tides, economic swings, and regulatory moods.
Let’s play this out.
Are your contracts in Brazil bulletproof against union scrutiny? Are your subcontracting arrangements in Mexico fully compliant after the 2021 reforms? Are you absolutely certain that your SOW model in Argentina won’t be reclassified tomorrow?
If you’re managing from global HQ, how often are you checking in with in-country legal experts? Or are you just assuming last year’s model still works?
And here’s a deeper question. If your MSP or internal team says, “we’ve never had an issue,” is that because you’re doing everything right, or because no one’s looked too closely yet?
🗣️ “We tried to implement our global tenure policy in Argentina and it backfired. Contractors walked. We couldn’t replace them fast enough.”
— LATAM Talent Director, Global Pharma Firm
LATAM’s Labor Culture Is Deeply Human
Forget automated workflows and procurement-approved processes for a second.
In LATAM, hiring is personal. Referrals matter. WhatsApp is often more powerful than your VMS. And the best suppliers? They aren’t always the largest. They’re the ones with deep local relationships.
That might sound quaint. But it’s strategic.
So here’s the uncomfortable question: Is your global supplier, the one you’re mandating across LATAM, even known locally? Can they actually deliver talent, or are they leaning on a brand name and hope?
What about your contingent workers? Are they engaging with your brand because they trust it or because they have no better option? Do they even understand the contract they’ve signed?
If you’re not asking these questions, your program might be running on assumptions, not truth.
💬 One global client tried to enforce their Europe-based tenure policy across LATAM. Within weeks, their Brazil team lost half its contingent staff to a local competitor offering stability. They had to pause an entire product line rollout.
MSP and VMS Reality Check
If your governance model relies on centralized MSP oversight and sleek dashboards, it’s time to ask some tough questions:
Is your MSP fluent in local languages and labor laws?
Are hiring managers following the VMS process or working around it?
Is your VMS even activated in every location? Or are you running on spreadsheets and shadow systems?
Many global leaders assume visibility means compliance. But in LATAM, visibility often only reveals what you’re permitted to see.
🌍 Global Blind Spots: What HQ Usually Gets Wrong
Top 5 Global Blind Spots in LATAM Programs
❌ Standardizing tenure rules across borders
❌ Prioritizing global brand suppliers over local relationships
❌ Ignoring FX volatility in pricing
❌ Enforcing English-only systems
❌ Trusting dashboards without field validation
Which of these is hiding in your playbook?
Nearshoring Is Not a Free Lunch
LATAM is a rising star for nearshore delivery — proximity to North America, bilingual talent, cost advantages.
But nearshoring doesn’t guarantee success.
If your MSP lacks LATAM expertise, if your legal frameworks are copy-pasted, if your VMS isn’t locally optimized, then all you’ve done is move your risk closer to home.
“Nearshoring isn’t just about cost savings. It’s about readiness. If your legal, operational, and supplier frameworks aren’t tailored to LATAM realities, you’re not nearshoring. You’re just shifting the risk.”
The Instability Factor. Why It Matters
LATAM isn’t just diverse. It’s unpredictable. Currency crashes. Political reform. Pop-up regulation. Nearshoring booms.
How flexible is your program?
Can you pivot when Brazil changes tax codes? When Mexico inflation surges and your markups evaporate? When Chile adds new ESG disclosure rules?
You need a program built for change, not control.
What You Don’t Know Will Hurt You
There are still too many blind spots in most LATAM programs:
Contracts not reviewed by local counsel
Payroll handled off-platform
Compliance policies copied from other regions
Workers misclassified under obsolete models
Ask yourself:
When was your last on-the-ground audit?
Who in your team truly understands LGPD or Mexico’s reforms?
Are you confident? Or just unaware?
What a Better LATAM Program Actually Looks Like
Success doesn’t require a revolution. It requires respect.
In-country governance that reflects labor law
Local suppliers with real sourcing power
FX monitoring that sees around corners
Onboarding and tenure strategies built for each country
Custom risk scores that match local context
You don’t need more tools. You need more truth.
I’ve helped global companies navigate LATAM labor reform, nearshoring pivots, supplier redesigns, and regional compliance overhauls. The programs that succeed? They engage early, listen often, and build trust before they mandate change.
Reflection Time
Are your dashboards giving insight or giving comfort?
Is your VMS being used in-market or ignored?
When did your LATAM strategy last evolve?
Do your suppliers in Colombia or Chile want to work with your MSP?
Is your model built for reality or designed for optics?
What Should You Do Next?
📍 Get real about your local presence:
Reassess your supplier panel. Who has reach and who has a logo?
Audit onboarding and contracts. Are they locally intelligent?
Pressure test your risk model. Would it survive an audit?
🧾 LATAM Reality Readiness: Can You Say Yes to These?
We use in-country legal review for all contracts
We validate real supplier sourcing capability
Our MSP speaks the language and the law
We tailor tenure policies by market
Our VMS is adopted locally, not just deployed globally
Final Thought
LATAM is no longer “just another region.” It’s central to delivery, talent, and innovation.
To succeed here, you need more than playbooks. You need presence.
Your contingent workforce in LATAM isn’t waiting for alignment. They’re waiting for someone who understands their reality.
Are you ready to meet them there?
💡 This essay is part of a global series on contingent workforce realities. If this essay resonated, be sure to explore our deep dives into Europe and APAC.
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If you need support on your journey, upgrade to a paid subscription where you’ll instantly be able to interact with the community through group chat, live Q&A’s, gain access practical program tools and useful how-to guides.