Contractor or Employee? How To Know Which One Is Right For You

There are a few things to consider when thinking about hiring a contractor or an employee. Before you begin down this road, please note that there are also legal parameters that you need to consider here that this article cannot address. It’s important for you to understand the legal differences between both options so that you can make the best decision for your company.

That being said, there are some guidelines for you to think about that can help you make a decision about what kind of team member you need.

Project basis

Do you have an important project that needs a specialist, but isn’t common for your business? Do you have a certain set of projects that only come up every once in a while, so you know that bringing someone on would end up with a lot of dead time for that team member?

Hiring contractors for specific projects can be helpful, especially when you have repetitive projects that you’ll need help with.

For example, if you know that every three months you need a copywriting project completed, but there’s no use for a copywriter in between those projects, then bringing on an employee would most likely not be your most effective use of time and money. Not to mention, when employees get bored, they become disengaged.

In this particular scenario, it makes way more sense to hire a contractor that you use regularly rather than hiring a full-time employee.

Seasonal

Seasonal workers are important in many businesses. The difference between contractors and employees in the seasonal situation most often comes down to how often you need someone to work for you.

If you need someone daily or on a regular schedule, you likely need to explore hiring a seasonal employee. If you need someone for certain projects or to deliver certain assets but you don’t necessarily need them in the office every day, you’re leaning more toward contractors.

Remember, if you have openings on your team that you need to fill, seasonal work is a great trial run to see how these team members would perform for you regularly. That way, you’re developing a relationship and filling the temporary need, while potentially finding the right team member for a longer-term commitment.

Commitment level

Do you need your team members to be dedicated to your company and ONLY your company? Or is it okay for them to be working with several other companies at the same time?

If you need someone to be dedicated to you, and you alone, then you’re more likely to need an employee.

If you’re all in on high-fiving your team member for delivering to multiple clients and making their own schedule, then you’re heading more into contractor territory.

All in all…

Make sure you get legal counsel on which type of team member is perfect for you. Contractors are great for specific projects and growing companies. They help keep costs lower, but they do come with less commitment to your company. Employees are more expensive and time-consuming, but the relationships developed can turn them into company ambassadors who stick with you through thick and thin. Each team member type has a time and place. Which one will fit your needs best?

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Author: Jolene Risch

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